Edgar Filing: OCCIDENTAL PETROLEUM CORP /DE/

Occidental Petroleum Corporation Definitive Proxy Statement

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

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Exchange Act of 1934 (Amendment No. )

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Occidental Petroleum Corporation

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Notice of 2008 Annual Meeting of Stockholders

and Proxy Statement

March 18, 2008

Dear Stockholders:

On behalf of the Board of Directors, it is my pleasure to invite you to Occidental’s 2008 Annual Meeting of Stockholders, which will be held on Friday, May 2, 2008, at the Starlight Ballroom, The Fairmont Miramar Hotel, Santa Monica, California.

Attached is the Notice of Meeting and the Proxy Statement, which describes in detail the matters on which you are being asked to vote. These matters include electing the directors, ratifying the selection of independent auditors, and transacting any other business that properly comes before the meeting, including any stockholder proposals.

Also enclosed are a Report to Stockholders, in which senior management discusses highlights of the year, and Occidental’s Annual Report on Form 10-K. As in the past, at the meeting there will be a report on operations and an opportunity to ask questions.

Whether you plan to attend the meeting or not, I encourage you to vote promptly so that your shares will be represented and properly voted at the meeting.

Sincerely,

Ray R. Irani

Chairman and Chief Executive Officer

Oxy

Friday, May 2, 2008

Starlight Ballroom

Fairmont Miramar Hotel

101 Wilshire Boulevard

Santa Monica, California

Meeting hours

Registration 9:30 a.m.

Meeting 10:30 a.m.

Admission Ticket or

Brokerage Statement

Required

OCCIDENTAL PETROLEUM CORPORATION

10889 WILSHIRE BOULEVARD, LOS ANGELES, CALIFORNIA 90024

March 18, 2008

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

To Our Stockholders:

Occidental's 2008 Annual Meeting of Stockholders will be held at 10:30 a.m. on Friday, May 2, 2008, in the Starlight Ballroom, The Fairmont Miramar Hotel, 101 Wilshire Boulevard, Santa Monica, California.

At the meeting, stockholders will act on the following matters:

	1.	Election of directors;
	2.	Ratification of selection of KPMG LLP as independent auditors; and
	3.	Consideration of other matters properly brought before the meeting, including stockholder proposals. The Board of Directors knows of five stockholder proposals that may be presented.

These matters are described in detail in the Proxy Statement. The Board of Directors recommends a vote FOR Proposals 1 and 2 and AGAINST Proposals 3, 4, 5, 6 and 7.

Stockholders of record at the close of business on March 12, 2008, are entitled to receive notice of, to attend and to vote at the meeting.

Whether you plan to attend or not, it is important that you read the Proxy Statement and follow the instructions on your proxy card to vote by mail, telephone or Internet. This will ensure that your shares are represented and will save Occidental additional expenses of soliciting proxies.

Sincerely,

Donald P. de Brier

Executive Vice President, General Counsel and Secretary

TABLE OF CONTENTS

General Information	1
Proposal 1: Election of Directors	2
Information Regarding the Board of Directors and its Committees	5
Compensation of Directors	7
Section 16(a) Beneficial Ownership Reporting Compliance	8
Security Ownership of Certain Beneficial Owners and Management	8
Executive Compensation	10
Compensation Discussion and Analysis	10
Compensation Committee Report	21
Performance Graph	22
Executive Compensation Tables	23
Summary Compensation Table	23
Grants of Plan-Based Awards	24
Outstanding Equity Awards at December 31, 2007	26
Option Exercises and Stock Vested in 2007	29
Nonqualified Deferred Compensation	30
Potential Payments Upon Termination or Change of Control	32
Proposal 2: Ratification of Independent Auditors	38
Audit and Other Fees	38
Report of the Audit Committee	39
Ratification of Selection of Independent Auditors	39
Stockholder Proposals	39
Proposal 3: Scientific Report on Global Warming	40
Proposal 4: Advisory Vote on Executive Compensation	41
Proposal 5: Independence of Compensation Consultants	42
Proposal 6: Pay-for-Superior-Performance Principle	43
Proposal 7: Special Shareholder Meetings	45
Stockholder Proposals for the 2009 Annual Meeting of Stockholders	46
Nominations for Directors for Term Expiring in 2010	46
Annual Report	47
Exhibit A: Corporate Governance Policies and Other Governance Measures	A-1

PROXY STATEMENT

GENERAL INFORMATION

This Proxy Statement is furnished in connection with the solicitation of proxies by the Board of Directors of Occidental Petroleum Corporation, a Delaware corporation, for use at the Annual Meeting of Stockholders on May 2, 2008, and at any adjournment of the meeting. All numbers of shares and prices per share of Occidental common stock have been adjusted to give effect to the two-for-one stock split in August 2006.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE SHAREHOLDER MEETING TO BE HELD ON MAY 2, 2008

This Proxy Statement and Occidental’s Annual Report on Form 10-K for the year ended December 31, 2007 are available on Occidental’s web site at www.oxypublications.com.

ADMISSION TO THE ANNUAL MEETING

Attendance is limited to stockholders and one guest per stockholder. If you plan to attend the meeting in person and you are a stockholder of record, you must bring the admission ticket attached to your proxy or information card. If your shares are held in the name of a bank, broker or other holder of record and an admission ticket is not part of your voting instruction card, you will be admitted only if you have proof of ownership on the record date, such as a bank or brokerage account statement. In addition to your admission ticket or account statement, you may be asked to present valid picture identification, such as a driver's license or passport.

VOTING RIGHTS

This Proxy Statement and accompanying proxy card are being mailed beginning on or about March 18, 2008, to each stockholder of record as of March 12, 2008, which is the record date for the determination of stockholders entitled to receive notice of, to attend, and to vote at the meeting. As of the record date, Occidental had outstanding and entitled to vote 821,756,719 shares of common stock. A majority of outstanding shares must be represented at the meeting, in person or by proxy, to constitute a quorum and to transact business. You will have one vote for each share of Occidental’s common stock you own. You may vote in person at the meeting or by proxy. Proxies may be voted by completing and mailing the proxy card, by telephone or Internet as explained on the proxy card. You may not cumulate your votes.

VOTING OF PROXIES

The Board of Directors has designated Dr. Ray R. Irani, Mr. Aziz D. Syriani and Miss Rosemary Tomich, and each of them, with the full power of substitution, to vote shares represented by all properly executed proxies. The shares will be voted in accordance with the instructions on the proxy card. If no instructions are specified on the proxy card, the shares will be voted:

•	FOR all nominees for directors (see page 2);
•	FOR ratification of the independent auditors (see page 38); and
•	AGAINST Proposals 3, 4, 5, 6 and 7 (stockholder proposals begin on page 39).

In the absence of instructions to the contrary, proxies will be voted in accordance with the judgment of the person exercising the proxy on any other matter presented at the meeting in accordance with Occidental's By-laws.

BROKER VOTES

If your shares are held in street name, under New York Stock Exchange Rules, your broker can vote your shares on Proposals 1 and 2 but not for the stockholder proposals (Proposals 3, 4, 5, 6 and 7). If your broker does not have discretion and you do not give the broker instructions, the votes will be broker nonvotes, which will have the same effect as votes against the proposals.

VOTE REQUIRED

The vote required to elect directors and to approve each proposal is described with the proposal.

VOTING RESULTS

The Report of Inspector of Elections will be published on Occidental’s web site, www.oxy.com, within 14 calendar days following the date of the meeting, and the results of the vote will be included in Occidental’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2008, and in the Report on the Annual Meeting, both of which may be accessed through www.oxy.com or obtained by writing to Publications Department, Occidental Petroleum Corporation, 10889 Wilshire Boulevard, Los Angeles, California 90024.

CONFIDENTIAL VOTING

All proxies, ballots and other voting materials are kept confidential, unless disclosure is required by applicable law or expressly requested by you, you write comments on your proxy or voting instruction card, or the proxy solicitation is contested. Occidental’s confidential voting policy is posted on www.oxy.com and may also be obtained by writing to Occidental’s Corporate Secretary, 10889 Wilshire Boulevard, Los Angeles, California 90024.

REVOKING A PROXY OR CHANGING YOUR VOTE

You may revoke your proxy or change your vote before the meeting by filing a revocation with the Corporate Secretary of Occidental, by delivering to Occidental a valid proxy bearing a later date or by attending the meeting and voting in person.

SOLICITATION EXPENSES

Expense of this solicitation will be paid by Occidental. Morrow & Co., Inc. has been retained to solicit proxies and assist in distribution and collection of proxy material for a fee estimated at $15,000 plus reimbursement of out-of-pocket expenses. Occidental also will reimburse banks, brokers, nominees and related fiduciaries for the expense of forwarding soliciting material to beneficial owners of the common stock. In addition, Occidental's officers, directors and regular employees may solicit proxies but will receive no additional or special compensation for such work.

PROPOSAL 1: ELECTION OF DIRECTORS

Directors are elected by a plurality of votes. However, pursuant to Occidental’s By-laws, a director who receives a greater number of votes “against” his or her election than votes “for” in any election (a “Majority Against Vote”) must tender his or her resignation. The Corporate Governance, Nominating and Social Responsibility Committee (“Nominating Committee”) will consider the resignation and possible responses to it based on the relevant facts and circumstances, and make a recommendation to the Board of Directors. The Board of Directors must act on the Nominating Committee’s recommendation within 90 days following certification of the stockholder vote by the Inspector of Elections. Any director who tenders his or her resignation pursuant to such By-law provision cannot participate in the Nominating Committee’s recommendation or Board of Directors’ action regarding whether to accept the resignation. The Board of Directors will disclose promptly its decision-making process and decision whether to accept or reject the director’s resignation in a Form 8-K filed with the Securities and Exchange Commission.

Unless you specify differently on the proxy card, proxies received will be voted FOR Spencer Abraham, Ronald W. Burkle, John S. Chalsty, Edward P. Djerejian, John E. Feick, Dr. Ray R. Irani, Irvin W. Maloney, Avedick B. Poladian, Rodolfo Segovia, Aziz D. Syriani, Rosemary Tomich and Walter L. Weisman to serve for a one-year term ending at the 2009 Annual Meeting, but in any event, until his or her successor is elected and qualified, unless ended earlier due to his or her death, resignation, disqualification or removal from office. The Nominating Committee and the Board of Directors have waived the retirement age requirement with respect to Mr. Maloney and requested that Mr. Maloney serve an additional term. In the event any nominee should be unavailable at the time of the meeting, the proxies may be voted for a substitute nominee selected by the Board of Directors.

Mr. R. Chad Dreier, a member of the Audit Committee and Executive Compensation and Human Resources Committee, is not standing for re-election as a director.

The following biographical information is furnished with respect to each of the nominees for election at the 2008 Annual Meeting.

The Board of Directors recommends a vote FOR all of the nominees.

SPENCER ABRAHAM, 55

Since September 2005, Mr. Abraham has been Chairman and Chief Executive Officer of The Abraham Group, a business consulting firm based in Washington, D.C., and since 2005, has been a distinguished visiting fellow at the Hoover Institution, a public policy research center headquartered at Stanford University and devoted to the study of politics, economics and political economy as well as international affairs. He served as the Secretary of Energy, United States Department of Energy, from 2001 through January 2005. Prior to that, he was a United States Senator, representing the State of Michigan from 1995 to 2001. From 1993 to 1994, he was of counsel to the law firm of Miller, Canfield, Paddock & Stone. He was a co-chairman of the National Republican Congressional Committee from 1991 to 1993 and Chairman of the Michigan Republican Party from 1983 to 1991. Mr. Abraham holds a juris doctorate degree from Harvard Law School. Mr. Abraham also is a director of ICx Technologies and serves as the non-executive chairman of AREVA, Inc., the U.S. subsidiary of the French-owned nuclear company, and Green Rock Energy.

Director since 2005.

Member of the Charitable Contributions Committee, Environmental, Health and Safety Committee, and Executive Compensation and Human Resources Committee.

	RONALD W. BURKLE, 55 Mr. Burkle is the managing partner and majority owner of The Yucaipa Companies, a private investment firm that invests primarily its own capital and that he co-founded in 1986. He is a trustee of the John F. Kennedy Center for the Performing Arts, a trustee of the J. Paul Getty Trust and a member of the Board of the Carter Center. Mr. Burkle also is a director of KB Home and Yahoo!. Director since 1999. Member of the Dividend Committee.
	JOHN S. CHALSTY, 74 Mr. Chalsty is a principal and has served as Chairman of Muirfield Capital Management LLC, an asset management firm, since 2002. He served as Senior Advisor to Credit Suisse First Boston during 2001, was Chairman of Donaldson, Lufkin & Jenrette, Inc., an investment banking firm, from 1996 through 2000 and served as its President and Chief Executive Officer from 1986 to 1996. Mr. Chalsty is a Trustee Emeritus of Columbia University and President of Lincoln Center Theatre. Director since 1996. Member of the Audit Committee, Corporate Governance, Nominating and Social Responsibility Committee, Dividend Committee, Executive Committee, and Executive Compensation and Human Resources Committee (Chair).
	EDWARD P. DJEREJIAN, 69 Ambassador Djerejian has been founding director of the James A. Baker III Institute for Public Policy at Rice University since 1994. Before that, he had a career in foreign service that included serving as United States Ambassador to Israel from 1993 to 1994, as Assistant Secretary of State for Near Eastern Affairs from 1991 to 1993 and as United States Ambassador to the Syrian Arab Republic from 1988 to 1991. Ambassador Djerejian also is a director of Baker Hughes, Inc. and Global Industries, Ltd. Director since 1996. Member of the Charitable Contributions Committee, Corporate Governance, Nominating and Social Responsibility Committee, and Environmental, Health and Safety Committee.
	JOHN E. FEICK, 64 Mr. Feick is the Chairman and a major stockholder of Matrix Solutions Inc., a provider of environmental remediation and reclamation services. He was President and Chief Executive Officer of Matrix from 1995 to 2003. He also is Chairman and a partner in Kemex Engineering Services, Ltd., which offers engineering and design services to the petrochemical, refining and gas processing industries. He was President and Chief Operating Officer of Novacor Chemicals, a subsidiary of Nova Corporation, from 1984 to 1994. Mr. Feick also is a director of Fort Chicago Energy Partners LP. Director since 1998. Member of the Audit Committee, Dividend Committee, Environmental, Health and Safety Committee, and Executive Committee.
	DR. RAY R. IRANI, 73 Dr. Irani has been Chairman and Chief Executive Officer of Occidental since 1990. He was Chief Operating Officer from 1984 to 1990. He was Chairman of the Board of Directors of Canadian Occidental Petroleum Ltd. (now Nexen Inc.) from 1987 to 1999. Dr. Irani also is a director of Wynn Resorts, Limited and TCW Group. Director since 1984. Member of the Dividend Committee and Executive Committee (Chair).

	IRVIN W. MALONEY, 77 From 1992 until his retirement in 1998, Mr. Maloney was President and Chief Executive Officer of Dataproducts Corporation, which designs, manufactures and markets printers and supplies for computers. Director since 1994. Member of the Audit Committee, Charitable Contributions Committee, Executive Committee, and Executive Compensation and Human Resources Committee.
	AVEDICK B. POLADIAN, 56 Since 2006, Mr. Poladian has been the Chief Operating Officer of Lowe Enterprises, Inc., a diversified national real estate company active in commercial, residential and hospitality property investment, management and development. He was Executive Vice President, Chief Financial Officer and Chief Administrative Officer for Lowe from 2003 to 2006. Mr. Poladian was with Arthur Andersen from 1974 to 2002 and is a certified public accountant. He is on the board of the YMCA of Metropolitan Los Angeles and a former Trustee of Loyola Marymount University. Mr. Poladian also is a director of California Pizza Kitchen and Western Asset Funds (Western Asset Income Fund, Western Asset Premier Bond Fund and Western Asset Funds, Inc.). Nominee.
	RODOLFO SEGOVIA, 71 Mr. Segovia is on the Executive Committee of Inversiones Sanford, a diversified investment group with emphasis in petrochemicals, specialty chemicals and plastics with which he has been affiliated since 1965. A former President of the Colombian national oil company (Ecopetrol) as well as Minister and Senator of the Republic of Colombia, he has been President and Chief Executive Officer of polyvinyl chloride and polypropylene companies. Mr. Segovia is a Trustee of the University of the Andes and serves as an advisor to the Martindale Center of Lehigh University, where he served as a visiting professor. Director since 1994. Member of the Charitable Contributions Committee, Corporate Governance, Nominating and Social Responsibility Committee, Environmental, Health and Safety Committee (Chair), Executive Committee, and Executive Compensation and Human Resources Committee.
	AZIZ D. SYRIANI, 65 Mr. Syriani has served since 2002 as the President and Chief Executive Officer of The Olayan Group, a diversified trading, services and investment organization with activities and interests in the Middle East and elsewhere. From 1978 until 2002, he served as the President and Chief Operating Officer of The Olayan Group. Mr. Syriani also is a director of The Credit Suisse Group. He was Chairman of the Audit Committee of The Credit Suisse Group from April 2002 until April 2004, and since April 2004, has been Chairman of its Compensation Committee. Director since 1983. Lead Independent Director since 1999. Member of the Audit Committee (Chair), Corporate Governance, Nominating and Social Responsibility Committee, Dividend Committee, and Executive Committee.
	ROSEMARY TOMICH, 70 Miss Tomich has been owner of the Hope Cattle Company since 1958 and the A. S. Tomich Construction Company since 1970. Additionally, she is Chairman of the Board of Directors and Chief Executive Officer of Livestock Clearing, Inc. and was a founding director of the Palm Springs Savings Bank. Miss Tomich serves on the Advisory Board of the University of Southern California Marshall School of Business and the Board of Councillors for the School of Letters and Sciences at the University of Southern California and is a Trustee Emeritus of the Salk Institute. Director since 1980. Member of the Audit Committee, Charitable Contributions Committee (Chair), Corporate Governance, Nominating and Social Responsibility Committee (Chair), Environmental, Health and Safety Committee, Executive Committee, and Executive Compensation and Human Resources Committee.

WALTER L. WEISMAN, 72

Since 1988, Mr. Weisman has been involved in private investments and volunteer activities. Prior to 1988, he was Chairman and Chief Executive Officer of American Medical International, a multinational hospital firm. Mr. Weisman also is a director of Fresenius Medical Care AG and Vice Chairman and Lead Director of Maguire Properties, Inc. He is past Chairman and a life trustee of the Los Angeles County Museum of Art, Vice Chairman of the Board of the California Institute of Technology, Chairman of the Board of the Sundance Institute and a Trustee of the Samuel H. Kress Foundation.

Director since 2002.

Member of the Corporate Governance, Nominating and Social Responsibility Committee, Dividend Committee, and Environmental, Health and Safety Committee.

INFORMATION REGARDING THE BOARD OF DIRECTORS AND ITS COMMITTEES

CORPORATE GOVERNANCE – The Corporate Governance Policies, together with information about Occidental’s Code of Business Conduct and other governance measures adopted by the Board of Directors, are set forth in Exhibit A and are also available at www.oxy.com or by writing to Occidental’s Corporate Secretary, 10889 Wilshire Boulevard, Los Angeles, California 90024.

Pursuant to Occidental’s written Conflict of Interest Policy, each director and executive officer has an obligation to avoid any activity, agreement, business investment or interest, or other situation that could be construed either as divergent to or in competition to Occidental’s interest or as an interference with such person’s primary duty to serve Occidental, unless prior written approval has been granted by the Audit Committee of the Board of Directors. Each director and executive officer is required to complete an annual questionnaire that requires disclosure of any transaction between Occidental and him or her or any of his or her affiliates or immediate family members. A summary of the Conflict of Interest Policy is included in Occidental’s Code of Business Conduct.

DIRECTOR EDUCATION – In 2007, two corporate governance training sessions were provided to directors by the University of Southern California Marshall School of Business.

INDEPENDENCE – Each of Miss Tomich and Messrs. Abraham, Burkle, Chalsty, Djerejian, Dreier, Feick, Maloney, Poladian, Segovia, Syriani and Weisman has been determined by the Board of Directors as meeting the independence standard set forth in Occidental’s Corporate Governance Policies (see Exhibit A) and the New York Stock Exchange Listed Company Manual. In making its determination of independence, the Board considered that, as disclosed under Compensation of Directors on page 8, Occidental matched the gifts made by certain of the directors to charitable organizations. Except for the Executive Committee and the Dividend Committee, all committees of the Board are composed of independent directors.

MEETINGS – The Board of Directors held six regular meetings during 2007, including two executive sessions at which no members of management were present. Mr. Syriani, the Lead Independent Director, presided over the executive sessions. Each director attended at least 75 percent of the meetings of the Board of Directors and the committees of which he or she was a member, and all of the directors attended the 2007 Annual Meeting. Attendance at the annual meeting of stockholders is expected of all directors as if it were a regular meeting.

SUCCESSION PLANNING – The Board of Directors annually reviews Occidental’s policies and principles for recruiting, developing and selecting the persons to succeed the Chairman and Chief Executive Officer and the other executive officers. The review includes the background, training, qualities and other characteristics that would be desirable in candidates as well as consideration of possible successors.

COMMUNICATIONS WITH BOARD MEMBERS – Stockholders and other interested parties may communicate with any director by sending a letter or facsimile to such director’s attention in care of Occidental’s Corporate Secretary, 10889 Wilshire Boulevard, Los Angeles, California 90024; facsimile number 310-443-6977. The Corporate Secretary opens, logs and forwards all such correspondence (other than advertisements or other solicitations) to directors unless the director to whom the correspondence is addressed has requested the Corporate Secretary to forward correspondence unopened.

LEAD INDEPENDENT DIRECTOR AND COMMITTEES – The Board of Directors has a Lead Independent Director and seven standing committees: Executive; Audit; Corporate Governance, Nominating and Social Responsibility; Charitable Contributions; Dividend; Executive Compensation and Human Resources; and Environmental, Health and Safety. The Audit Committee Charter, the Executive Compensation and Human Resources Committee Charter and the Corporate Governance, Nominating and Social Responsibility Committee Charter and the enabling resolutions for each of the other committees are available at www.oxy.com or by writing to Occidental’s Corporate Secretary, 10889 Wilshire Boulevard, Los Angeles, California 90024. The general duties of the Lead Independent Director and the committees are described below. From time to time, the Board of Directors delegates additional duties to the standing committees.

Name and Members	Responsibilities		Meetings or Written Actions in 2007
Lead Independent Director Aziz D. Syriani	•	coordinates the activities of the independent directors	Not applicable
	•	advises the Chairman on the schedule and agenda for Board meetings
	•	assists in assuring compliance with Occidental’s Corporate Governance Policies
	•	assists the Executive Compensation and Human Resources Committee in evaluating the Chairman’s performance
	•	recommends to the Chairman membership of the various Board committees
Audit Committee John S. Chalsty R. Chad Dreier ⁽¹⁾ John E. Feick Irvin W. Maloney Aziz D. Syriani (Chair) Rosemary Tomich	All of the members of the Audit Committee are independent as defined in the New York Stock Exchange Listed Company Manual. All of the members of the Audit Committee are financially literate and the Board has determined that Messrs. Chalsty and Dreier meet the Securities and Exchange Commission’s definition of “audit committee financial expert.” The Audit Committee Report with respect to Occidental's financial statements is on page 39. The primary duties of the Audit Committee are as follows:		8 meetings including 8 executive sessions with no members of management present
	•	hires the independent auditors to audit the consolidated financial statements, books, records and accounts of Occidental and its subsidiaries
	•	discusses the scope and results of the audit with the independent auditors
	•	discusses Occidental's financial accounting and reporting principles and the adequacy of Occidental's internal accounting, financial and operating controls with the auditors and with management
	•	reviews all reports of internal audits submitted to the Audit Committee and management's actions with respect thereto
	•	reviews the appointment of the senior internal auditing executive
	•	oversees all matters relating to Occidental’s Code of Business Conduct compliance program
Charitable Contributions Spencer Abraham Edward P. Djerejian Irvin W. Maloney Rodolfo Segovia Rosemary Tomich (Chair)	•	oversees charitable contributions made by Occidental and its subsidiaries	5 meetings
Corporate Governance, Nominating and Social Responsibility Committee John S. Chalsty Edward P. Djerejian Rodolfo Segovia Aziz D. Syriani Rosemary Tomich (Chair) Walter L. Weisman	•	recommends candidates for election to the Board	5 meetings
	•	is responsible for the periodic review and interpretation of Occidental's Corporate Governance Policies and consideration of other governance issues
	•	oversees the evaluation of the Board and management
	•	reviews Occidental’s policies, programs and practices on social responsibility, including the Corporate Matching Gift Program
	•	oversees compliance with Occidental’s Human Rights Policy
	See page 46 for information on how nominees are selected and instructions on how to recommend nominees for the Board.
Dividend Committee Ronald W. Burkle John S. Chalsty John E. Feick Dr. Ray R. Irani Aziz D. Syriani Walter L. Weisman	•	has authority to declare the quarterly cash dividend on the Common Stock	1 meeting
Environmental, Health and Safety Committee Spencer Abraham Edward P. Djerejian John E. Feick Rodolfo Segovia (Chair) Rosemary Tomich Walter L. Weisman	•	reviews and discusses with management the status of health, environment and safety issues, including compliance with applicable laws and regulations	5 meetings
	•	reviews the results of internal compliance reviews and remediation projects
	•	reports periodically to the Board on environmental, health and safety matters affecting Occidental and its subsidiaries

Name and Members	Responsibilities		Meetings or Written Actions in 2007
Executive Committee John S. Chalsty John E. Feick Dr. Ray R. Irani (Chair) Irvin W. Maloney Rodolfo Segovia Aziz D. Syriani Rosemary Tomich	•	exercises the powers of the Board with respect to the management of the business and affairs of Occidental between meetings of the Board	None
Executive Compensation and Human Resources Committee Spencer Abraham John S. Chalsty (Chair) R. Chad Dreier ⁽¹⁾ Irvin W. Maloney Rodolfo Segovia Rosemary Tomich	•	reviews and approves the corporate goals and objectives relevant to the compensation of the Chief Executive Officer (“CEO”), evaluates the CEO’s performance and determines and approves the CEO’s compensation	5 meetings including 3 executive sessions with no members of management present
	•	reviews and approves the annual salaries, bonuses and other executive benefits of all other executive officers
	•	administers Occidental's stock-based incentive compensation plans and periodically reviews the performance of the plans and their rules
	•	reviews new executive compensation programs
	•	periodically reviews the operation of existing executive compensation programs as well as policies for the administration of executive compensation
	•	reviews director compensation annually
	The Executive Compensation and Human Resources Committee's report on executive compensation is on page 21.

(1)	Not standing for re-election to the Board of Directors.

COMPENSATION OF DIRECTORS

For 2007, each non-employee director:

•	was paid a retainer of $60,000 per year, plus $2,000 for each meeting of the Board of Directors or of its committees he or she attended in person or telephonically; and
•	received an annual grant of 5,000 restricted shares of common stock, plus an additional 800 restricted shares of common stock for each committee he or she chaired or for serving as lead independent director.

Directors are eligible to participate on the same terms as Occidental employees in the Occidental Petroleum Corporation Matching Gift Program, which matches contributions made by employees and directors up to an aggregate of $50,000 per year to educational institutions and organizations, as well as arts and cultural organizations. In addition, Occidental reimburses non-employee directors for expenses related to service on the Board, including hotel, airfare, ground transportation and meals for themselves and their significant others, and permits, subject to availability, non-employee directors to make use of company aircraft on the same reimbursement terms applicable to executive officers of Occidental. Occidental does not provide option awards, non-equity incentive awards, deferred compensation or retirement plans for non-employee directors. A table summarizing the total compensation for 2007 for each of the non-employee directors is set forth below.

Compensation of Directors
Name	Fees Earned or Paid in Cash ($)			Stock Awards ($) (1)			All Other Compensation ($) (2)			Total ($)
Spencer Abraham		$	102,000		$	257,500		$	8,486	$	367,986
Ronald W. Burkle		$	72,000		$	257,500		$	0	$	329,500
John S. Chalsty		$	108,000		$	298,700		$	31,161	$	437,861
Edward P. Djerejian		$	102,000		$	257,500		$	3,678	$	363,178
R. Chad Dreier		$	98,000		$	257,500		$	0	$	355,500
John E. Feick		$	98,000		$	257,500		$	2,144	$	357,644
Irvin W. Maloney		$	108,000		$	257,500		$	1,356	$	366,856
Rodolfo Segovia		$	112,000		$	298,700		$	29,516	$	440,216
Aziz D. Syriani		$	94,000		$	339,900		$	4,112	$	438,012
Rosemary Tomich		$	128,000		$	339,900		$	0	$	467,900
Walter L. Weisman		$	94,000		$	257,500		$	41,500	$	393,000

(1)

Restricted Stock Awards are granted to each non-employee director on the first business day following the Annual Meeting. The shares subject to these awards are fully vested on the date of grant, but may not be sold or transferred for three years except in the case of death or disability. The dollar amounts shown reflect the amount recognized for financial reporting purposes pursuant to Statement of Financial Accounting Standard No. 123 (Revised 2004, Share-Based Payment (“FAS 123(R)”). See Note 12 to Consolidated Financial Statements in Occidental’s Annual Report on Form 10-K for the year ended December 31, 2007, regarding assumptions underlying valuation of equity awards. The number of Restricted Stock Awards outstanding for each director is shown in the Beneficial Ownership Table on page 9.

(2)

None of the non-employee directors received any fees or payment for services other than as a director. Amounts shown include personal benefits in excess of $10,000, all tax gross-ups regardless of amount and matching charitable contributions. For Messrs. Djerejian, Feick, Maloney and Syriani, the amount shown is the tax gross-up related to reimbursement of spousal travel cost. For Mr. Weisman, the amount shown is the charitable contribution pursuant to Occidental’s Matching Gift Program. For Messrs. Abraham, Chalsty and Segovia, $2,719, $6,161 and $4,516, respectively, is for the tax gross-up related to reimbursement for spousal travel and $5,767, $25,000 and $25,000, respectively, is the charitable contribution pursuant to Occidental’s Matching Gift Program.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Pursuant to Section 16(a) of the Securities Exchange Act of 1934 and the rules issued thereunder, Occidental's executive officers, directors and any beneficial owner of more than 10 percent of any class of Occidental's equity securities are required to file, with the Securities and Exchange Commission and the New York Stock Exchange, reports of ownership and changes in ownership of common stock. Copies of such reports are required to be furnished to Occidental. Based solely on its review of the copies of the reports furnished to Occidental or written representations that no reports were required, Occidental believes that, during 2007, all persons required to report complied with the Section 16(a) requirements.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

At the close of business on February 29, 2008, the beneficial owner of common stock shown below was the only person known to Occidental to be the beneficial owner of five percent or more of the outstanding voting securities of Occidental.

Name and Address

Number of

Shares

Owned

Percent of

Outstanding

Common

Stock

Sole

Voting

Shares

Shared

Voting

Shares

Sole

Investment

Shares

Shared

Investment

Shares

Barclays Global Investors, N.A.

45 Fremont Street

San Francisco, California 94105

42,370,587

⁽¹⁾

5.11

⁽¹⁾

37,004,868

⁽¹⁾

—

⁽¹⁾

42,370,587

⁽¹⁾

—

⁽¹⁾

(1)	Pursuant to Schedule 13G, filed as of February 6, 2008 with the Securities and Exchange Commission.

The following table sets forth certain information regarding the beneficial ownership of common stock as of February 29, 2008, by each of the named executive officers, the directors of Occidental, the new nominee to the Board of Directors and all executive officers, directors and nominee as a group. The directors are subject to stock ownership guidelines as described in Occidental’s Corporate Governance Policies (see Exhibit A). The executive officers are subject to stock ownership guidelines, which range from two to 10 times base salary (see Executive Stock Ownership at www.oxy.com). All of the directors and current executive officers were in compliance with the guidelines as of February 29, 2008.

Beneficial Ownership of Directors, Nominee and Executive Officers
Name	Sole Voting and Investment Shares (1)			Restricted Shares (2)		Exercisable Options (3)		Total Shares Beneficially Owned (4)			Percent of Outstanding Common Stock (5)		Restricted/ Performance Stock Units (6)
Spencer Abraham		0			10,386		0		10,386					0
Ronald W. Burkle		14,000			30,000		0		44,000					0
John S. Chalsty		19,840			24,166		0		44,006					0
Stephen I. Chazen		1,405,817			0		1,361,280		2,767,097					341,248
Donald P. de Brier		594,316			0		653,334		1,247,650					103,175
Edward P. Djerejian		19,737			30,000		0		49,737					0
R. Chad Dreier		14,000			26,666		0		40,666					0
John E. Feick		6,000			30,000		0		36,000					0
Ray R. Irani		5,646,164			0		2,806,424		8,452,588			1.0%		1,060,862
Irvin W. Maloney		29,179			30,400		0		59,579					0
John W. Morgan		424,286	⁽⁷⁾		0		0		424,286	⁽⁷⁾				108,618
R. Casey Olson		117,881			0		66,667		184,548					82,872
Avedick B. Poladian		0			0		0		0					0
Rodolfo Segovia		37,890	⁽⁸⁾		32,797		0		70,687	⁽⁸⁾				0
Aziz D. Syriani		21,100			28,340		0		49,440					0
Rosemary Tomich		23,900			34,136		0		58,036					0
Walter L. Weisman		4,000			28,334		0		32,334					0
All executive officers, directors and nominee as a group (22 persons)		8,831,168	^{(7) (8)}		305,225		5,654,602		14,790,995	^{(7) (8)}		1.8%		1,875,319

(1)	Includes shares held through the Occidental Petroleum Corporation Savings Plan.
(2)	For non-employee directors, includes shares for which investment authority has not vested under the 1996 Restricted Stock Plan for Non-Employee Directors and the 2005 Long-Term Incentive Plan.
(3)	Includes options and stock appreciation rights which will be exercisable within 60 days.
(4)	Total is the sum of the first three columns.
(5)	Unless otherwise indicated, less than 1 percent.
(6)	Includes the restricted stock unit awards and awards at target level under performance stock awards and performance-based restricted share unit awards. Until the restricted or performance period ends, as applicable, and, in the case of both types of performance awards, until the awards are certified, no shares of common stock are issued. However, grant recipients receive dividend equivalents on the restricted stock units during the restricted period and on the target share amount of performance stock awards during the performance period. Dividend equivalents on performance-based restricted share unit awards are paid at the end of the performance period on the number of shares certified.
(7)	Includes 800 shares held by Mr. Morgan’s wife.
(8)	Includes 14,542 shares held by Mr. Segovia as trustee for the benefit of his children.

EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND ANALYSIS

COMPENSATION PHILOSOPHY AND OBJECTIVES

Occidental’s executive compensation program emphasizes performance-based compensation to encourage actions by executives that will drive long-term growth in stockholder value. The Executive Compensation and Human Resources Committee of the Board of Directors (the “Compensation Committee”) believes that exceptional performance — characterized by stockholder returns exceeding those of peer corporations, and superior financial results — merits exceptional compensation; and, conversely, that below-average returns should result in compensation well below peer averages.

Furthermore, the Compensation Committee acknowledges that how exceptional performance is recognized and rewarded is not a static process. In 2006 and in 2007, the Compensation Committee engaged Hewitt Associates LLC to recommend design changes that would recognize Occidental’s exceptional achievements in recent years, which have been reflected in the compensation received by the executive officers, while providing incentives for future performance consistent with the ultimate objective of long-term growth in stockholder value. The resulting compensation changes continue to focus on two fundamental elements:

	•	Performance-based awards, either equity or cash-based, which rely either on the attainment of predetermined performance measures or increases in the value of Occidental stock shared by all stockholders; and
	•	To a lesser extent, non-performance-based compensation, including cash compensation and other benefits competitive with the marketplace.

The key performance measures used for performance-based awards continue to be:

	•	Return on equity, which measures effectiveness of capital allocation and investment decisions. In the oil and gas industry, these are the primary determinants of long-term growth in stockholder value. In addition, this measure is objectively determinable from Occidental’s published financial statements.
	•	Total stockholder return, which uses a peer comparison that, over the performance period, neutralizes major market variables that have an impact on the entire oil and gas industry.
	•	Earnings per share, which directly measures growth in stockholder value and which is a readily determinable, commonly accepted measure of annual performance designed to compensate executives for current operating results.

As described more fully below, the Compensation Committee has made significant changes in the mix and terms of incentive awards granted in and after July 2007. The changes:

	•	Replaced time-based stock appreciation rights and restricted stock unit awards with performance-based return on equity and total stockholder return awards;
	•	Reduced the minimum payout that may be achieved for return on equity incentive awards from 20 percent to 1 percent;
	•	Reduced the maximum payout that may be achieved for the total stockholder return awards from 200 percent to 150 percent; and
	•	Reduced future dilution to the stock by shifting the return on equity awards to a cash payout, which also caps the maximum amount that can be earned, and by requiring total stockholder return awards to be settled half in shares and half in cash.

In addition, consistent with its belief that the executive officers with the highest levels of responsibility and compensation should have the highest percentage of their total compensation at-risk and variable, depending upon Occidental’s performance, the Compensation Committee increased the performance-based portion of Dr. Irani’s compensation to approximately 91 percent for 2007 (compared to approximately 56 percent, exclusive of options, for 2006) and to at least 81 percent for 2007 for each of the other named executive officers¹.

COMPENSATION PROGRAM ELEMENTS

PERFORMANCE-BASED COMPENSATION. Performance-based compensation may be either equity- or cash-based or a combination of both. These are more fully described in the Discussion of Specific Compensation Program Elements for 2007, beginning on page 13:

•

EQUITY COMPENSATION rewards the executive for intermediate and long-term accomplishments through various types of incentive awards. These awards are generally based on the achievement of specific internal or external financial performance goals measured over a three- to four-year period. Options, which have value only if the price of the stock increases, may also be granted. Equity compensation is intended to align a very significant portion of each executive’s net worth with Occidental’s success in growing stockholder value.

The percentage is calculated by dividing the target value of the performance-based awards (equity and non-equity) granted in 2007 by the sum of (i) the target value of the performance-based awards (equity and non-equity) granted in 2007 and (ii) the amounts shown in the “Salary,” “Bonus” and “Other” columns of the total compensation value tables on pages 18 to 20.

•

CASH INCENTIVES reward the executive for multi-year and current performance. Multi-year cash awards are based on the achievement of financial performance objectives over a three- to four-year term. Cash compensation awards for current performance are made annually and targeted as a percentage of base salary. The amount is linked to the attainment of Occidental’s annual financial goals, as well as a subjective assessment of the executive’s achievement of specific individual objectives in such areas as operational priorities, organizational development and governance.

NON-PERFORMANCE-BASED COMPENSATION.

	•	SALARY is the base cash compensation. Salary levels take into account job responsibilities, individual performance, experience level and competitive market data, and may be adjusted periodically.
	•	OTHER COMPENSATION programs encompass benefits such as defined contribution plans, deferred compensation and certain other benefits, including time-based restricted stock awards. Many of these programs are substantially similar to the basic level of cash and non-cash benefits that major companies in the oil and gas industry typically provide to salaried employees, except that Occidental does not provide a defined benefit pension plan to its salaried employees. Certain other benefits that apply only to senior executives are described below.

The following graphs show the performance-based compensation, option awards², and non-performance-based compensation³ as a percentage of the total compensation value established by the Compensation Committee for each of the named executive officers for 2007 as compared to 2006. See pages 17 to 20 for the values established for each of the named executive officers.

Comparison of Compensation Program Elements

[the following is a tabular representation of graphical materials]

	Performance-Based Compensation as percent of Total Compensation Value	Non-Performance-Based Compensation as percent of Total Compensation Value	Options/SARs as percent of Total Compensation Value
Ray R. Irani
2007	91.3	8.7	0
2006	55.5	10.0	34.5
Stephen I. Chazen
2007	93.4	6.6	0
2006	46.5	8.2	45.3
Donald P. de Brier
2007	81.4	18.6	0
2006	37.8	15.9	46.3
John W. Morgan
2007	83.9	16.1	0
2006	38.6	14.4	47.0
R. Casey Olson
2007	85.8	14.2	0

ROLE OF MANAGEMENT IN EXECUTIVE COMPENSATION

The Compensation Committee of the Board of Directors sets compensation for Occidental’s senior executives. Dr. Irani recommends compensation for Messrs. Chazen, de Brier, Morgan and Olson to the Compensation Committee. Dr. Irani’s compensation is set only by the Compensation Committee. Dr. Irani and the Executive Vice President - Human Resources may be present for a portion of each of the Compensation Committee meetings, but are not present when compensation decisions regarding Dr. Irani are discussed and made. Mr. Chazen may be present for a portion of certain meetings to provide the Compensation Committee information regarding Occidental’s financial and operating plans and results. Mr. de Brier may be present for a portion of certain meetings to provide the Compensation Committee legal advice. Occidental prepares materials for each Compensation Committee meeting to assist the Compensation Committee in its consideration of executive compensation programs and policies and its administration of plans and programs.

ROLE OF INVESTORS AND PROXY ADVISORY SERVICES

In 2007, Occidental initiated meetings with some of its largest and most influential institutional investors to discuss, among other things, the concept of an advisory vote on compensation, Occidental’s compensation disclosures, and the changes made to the executive compensation mix in 2006 and 2007. Occidental also discussed its 2006 and 2007 changes with RiskMetrics Group. Feedback obtained from these meetings was provided to the Compensation Committee and was taken into consideration in Occidental’s continuing efforts to improve the quality of its compensation disclosures.

2	No option-type awards were granted in 2007. The stock appreciation rights granted in 2006 had no performance-based vesting requirement.
3	Non-performance-based compensation includes the amounts shown in the “Salary,” “Bonus” and “Other” columns from the total compensation value tables on pages 18 to 20.

ROLE OF COMPENSATION CONSULTANTS

Each year, Occidental participates in compensation surveys conducted by Hewitt Associates LLC, Towers Perrin, Frederic W. Cook & Co. and other compensation consultants in order to better understand general external compensation practices, including executive compensation. From time to time, Occidental, through its executive compensation department or the Compensation Committee, will engage a consultant to provide advice on specific compensation issues. The Board’s policy on retention of compensation consultants adopted in 2008 is set forth in Exhibit A under “Other Governance Measures.”

In 2007, Hewitt Associates LLC (“Hewitt”) assisted the Compensation Committee with a study, discussed below, of long-term incentives. In retaining Hewitt, the Compensation Committee was aware that Hewitt has also provided actuarial services to Occidental. There are no other relationships between Hewitt and Occidental, nor does Hewitt provide services to any of Occidental’s named executive officers. The aggregate amount paid by Occidental to Hewitt in 2007, including the fees for the study, was less than one-tenth of 1 percent of Hewitt’s total annual revenues for 2007.

Hewitt’s 2007 Long-Term Incentive Strategy Study. Within the context of practices of the oil and gas industry (22 companies); general industry with revenues between $10 billion and $100 billion (median of $18.8 billion) excluding oil and gas and financial companies (123 companies); Occidental’s current practices; and Hewitt’s observations and recommendations, the study examined:

	•	The types and blends of long-term incentives appropriate at various executive levels;
	•	Total direct compensation mix at various levels; and
	•	Design alternatives for long-term incentives at various levels of the organization.

The study included peer group⁴ comparative data about plan design and participation rates in equity incentive plans. The study concluded, among other things, that:

•

With respect to forms of equity awards that have been used by Occidental:

	o	Stock-settled Stock Appreciation Rights (SARs) consume more shares than other forms of awards that deliver comparable value to the executive. SARs, if retained, should be used only for top-level employees.
	o	Performance-based Restricted Stock Unit awards that use equity as a performance measure conform to market design in terms of length of performance period, award frequency and plan leverage. Return on equity is an appropriate internal measure of Occidental’s performance, but target goals, threshold payments and maximum payment should be monitored for internal and external appropriateness.
	o	Performance awards using total stockholder return as the performance measure should be a more prominent portion of long-term incentives, consideration should be given to increasing the number of peer companies and payouts should be based on percentile rankings within the group rather than the current ordinal ranking.
	o	Restricted Stock Units should be used as a retention vehicle for employees earning less than $225,000 and possibly as a portion of total long-term incentive for officers other than the named executive officers.

•

For the named executive officers, consideration should be given to a mix of long-term incentives that include up to 30 percent in the form of SARs, 30 to 60 percent in the form of performance-based awards using total stockholder return as the performance measure, and 40 to 50 percent in the form of performance-based awards using the internal measure of return on equity.

Based on the information from the Hewitt study, as well as comparative data provided by management derived from the Towers Perrin Executive Compensation Data Bank, the Hewitt Executive Total Compensation Measurement Survey and the proxy statements of peer companies in the oil industry⁵, the Compensation Committee directed management to refine further the suggested design and mix for long-term incentives. As approved by the Compensation Committee and discussed below, the design changes and mix reinforce the Compensation Committee’s long-standing commitment that compensation should be linked to performance while at the same time reducing stockholder dilution and placing limits on the potential payout for the most significant awards.

DISCUSSION OF SPECIFIC COMPENSATION PROGRAM ELEMENTS FOR 2007

The Compensation Committee discussed the components of the compensation for the named executive officers for 2007 at its regularly scheduled meetings held in December 2006; February, May, July and December 2007; and February 2008. At various meetings, the Compensation Committee reviewed the elements of total compensation for each of the named executive officers as compared to the total compensation for the top five executives at other oil and gas companies, as disclosed in those companies’ respective 2006 proxy statements⁶. In addition to the Hewitt study discussed above, the Compensation Committee also reviewed the long-term incentive value and mix of awards granted to each of the named executive officers for the last four years; estimated future values of possible awards; and financial and other performance

4	The peer group reviewed included Anadarko Petroleum Corporation, Apache Corporation, Chevron Corporation, ConocoPhillips, Devon Energy Corporation, ExxonMobil Corporation, Hess Corporation, Marathon Oil Corporation and Valero Energy Corporation.
5	The proxy statements reviewed included Anadarko Petroleum Corporation, Apache Corporation, Chevron Corporation, ConocoPhillips, Devon Energy Corporation, ExxonMobil Corporation and Hess Corporation.
6	The companies reviewed were: Anadarko Petroleum Corporation, Apache Corporation, Chevron Corporation, ConocoPhillips, Devon Energy Corporation, ExxonMobil Corporation, Hess Corporation, Kerr-McGee Corporation and Marathon Oil Corporation.

measures contrasting Occidental with other oil and gas companies, including return on capital employed, return on equity, total stockholder return, revenues and market capitalization.

To continue to provide incentives for exceptional performance while capping the potential payout for a significant portion of the incentives and minimizing stockholder dilution, the Compensation Committee decided in July 2007 that:

•

The named executive officers should receive a long-term incentive consisting of:

	o	65 percent as a cash-based award based on Return on Equity; and
	o	35 percent as a cash- and stock-based award based on Total Stockholder Return.

•

The target values of the long-term incentive awards granted in July 2007 would be:

	o	Dr. Irani – $45 million ($29.25 million Return on Equity, $15.75 million Total Stockholder Return)
	o	Mr. Chazen – $20 million ($13 million Return on Equity, $7 million Total Stockholder Return)
	o	Mr. de Brier – $3.8 million ($2.47 million Return on Equity, $1.33 million Total Stockholder Return)
	o	Mr. Morgan – $4 million ($2.6 million Return on Equity, $1.4 million Total Stockholder Return)
	o	Mr. Olson – $4 million ($2.6 million Return on Equity, $1.4 million Total Stockholder Return)

EQUITY COMPENSATION

Executives may be granted equity incentives under Occidental’s stockholder-approved 2005 Long-Term Incentive Plan. These awards are intended to encourage executives to view Occidental from the stockholders’ perspective; to create an ongoing incentive for executives to increase stockholder value; and to retain executives who possess the skills and the commitment to ethical business practices that are crucial to Occidental’s success. For the 2007 grants, the percentage of total compensation value that is equity-based was reduced to decrease the dilutive effect of such awards on earnings per share. No options, stock appreciation rights, restricted stock units or performance-based restricted stock units were granted in 2007. For 2007, equity awards represent approximately one-third of the total compensation value provided to executive officers.

The equity awards granted to Dr. Irani and the other named executive officers for 2007 — Performance Stock Awards (PSAs) and Total Stockholder Return Incentives (TSRIs) — are performance-based awards based on Occidental’s total stockholder return compared to the total stockholder returns of other peer comparison companies⁷.

Payment under the PSAs and TSRIs is dependent upon Occidental’s total stockholder return over a four-year performance period compared to the total stockholder returns for a specified group of comparison companies. The comparison of total stockholder returns to peer companies’ returns over a period of time essentially neutralizes major market variables that have an impact on the entire oil and gas industry, thereby rewarding the executives for Occidental’s performance relative to the peer group companies.

PSAs – Consistent with its practice for the past 12 years, the Compensation Committee granted PSAs in December 2006 and set the performance period to begin January 1, 2007 and to end December 31, 2010. Target award levels for the PSAs were granted as a percentage of base salary, which was then converted into target share units. In setting target award levels for the PSAs, the Compensation Committee reviewed Occidental’s results for the twelve-month period ending September 30, 2006, among other factors. The percentages of base salary that were set as the PSA target award levels for Dr. Irani and the other named executive officers were:

	•	Dr. Irani – 165%
	•	Mr. Chazen – 100%
	•	Mr. de Brier – 70%
	•	Mr. Morgan – 75%
	•	Mr. Olson – 70%

The number of target share units awarded as PSAs (See Grants of Plan-Based Awards table at page 24) was determined by dividing the target dollar value of the award by the closing stock price on the last trading day before the start of the performance period. The payout amounts may vary from 0 percent to 200 percent of target. Payout is determined by reference to a grid which specifies the payout percentage depending on the number of companies remaining in the peer group at the end of the performance period. Any payout up to target will be paid in stock and any payout in excess of target will be paid in cash.

In conjunction with the reexamination of its long-term incentive grant practices, the Compensation Committee has decided that it will make long-term incentive grants only once a year in July beginning with 2007. Accordingly, no PSAs were awarded in December 2007 and no future grants of PSAs are planned at this time.

In addition to Occidental, for the PSAs, the peer group companies are Anadarko Petroleum Corporation, Apache Corporation, Chevron Corporation, ConocoPhillips, Devon Energy Corporation, ExxonMobil Corporation and Hess Corporation; and, for the TSRIs, the peer group companies are Anadarko Petroleum Corporation, Apache Corporation, BP p.l.c., Chevron Corporation, ConocoPhillips, Devon Energy Corporation, ExxonMobil Corporation and Royal Dutch Shell plc.

In February 2008, the Compensation Committee certified the total stockholder return calculations for the performance period from January 1, 2004, through December 31, 2007, in order to determine the payout for the PSAs granted in December 2003. The values of these vested PSAs are not included in the Option Exercises and Stock Vested table on page 29 because certification and payout occurred in 2008. Occidental ranked second out of the five remaining peer companies at December 31, 2007 and, as a result, the payout was at 150 percent for all of the named executive officers, except Mr. Olson. Mr. Olson’s PSA award had a divisional component, which increased the payout percentage to 157 percent. The number of equivalent shares earned by Dr. Irani, Mr. Chazen, Mr. de Brier, Mr. Morgan and Mr. Olson were 138,495, 29,832, 27,396, 23,118 and 12,141, respectively, of which the target share amount was settled in stock and the balance in cash.

TSRIs - Thirty-five percent of the long-term incentive value awarded to Dr. Irani and each of the other named executive officers in July 2007 was in the form of TSRIs with a performance period beginning July 18, 2007 and ending July 17, 2011 (see page 13). The number of target share units awarded as TSRIs was determined by dividing the target incentive value by the closing stock price on the date the Compensation Committee made the grant. Payout will be split equally between stock and cash regardless of the payout percentage. The payout amounts may vary from 0 percent to 150 percent, depending upon Occidental’s performance compared with its peers at the end of the performance period as follows:

Occidental’s Performance Compared to Peers		Payout
Bottom Third		0 percent
Middle Third		Linearly interpolated to provide a payout between 0 to 150 percent
Top Third		150 percent

CASH INCENTIVES

The Compensation Committee expanded the use of cash incentives in 2007 to include a multi-year performance-based cash award in the form of a Return on Equity Incentive in addition to the annual opportunity to earn non-equity incentive and bonus awards under the Executive Incentive Compensation Plan.

Return on Equity Incentive Award (ROEI) – Sixty-five percent of the long-term incentive value awarded to Dr. Irani and the other named executive officers in July 2007 (see page 13) was in the form of ROEIs. From 0 to 200 percent of the target incentive amount will be paid in cash upon achievement of an internal performance measure based on Occidental’s three-year cumulative return on equity. In the oil and gas industry, effective capital allocation and investment decisions are the primary determinants of long-term growth in stockholder value. The economic success of these investment decisions must be measured over a multi-year period, and the Compensation Committee believes return on equity is the best measure of such success for Occidental. Occidental believes consistent success in achieving superior returns on equity contributes to superior long-term growth in stockholder value.

Occidental’s cost of equity capital, which reflects Occidental’s dividend rate and stock volatility, as well as the current interest rate environment, is less than 10 percent on an annual basis. A minimum cumulative threshold in excess of 33 percent over the three-year performance period was selected to ensure that a payout would be made only if total return on equity exceeded Occidental’s expected cost of capital for the same period. Under the 2006 equity awards that have return on equity as the performance measure, grantees could receive a payout equal to 20 percent of target if Occidental attained the threshold 33 percent performance level. To further ensure that at or below cost of capital return is not rewarded, under the 2007 ROEI awards, grantees will not be entitled to any payout at or below the 33 percent level. Instead, grantees will receive one percent of target only when that performance level is exceeded. Maximum payout is attainable if return on equity at the end of the three-year performance period is 54 percent or higher. In selecting the maximum return on equity level, the Compensation Committee noted that Occidental is operating in a highly competitive environment with rapidly escalating costs and that the equity base was expected to continue increasing, factors that will make future performance targets more difficult to reach. Receipt of the maximum incentive amount would require that all of the following occur during the performance period:

	•	successful execution of Occidental’s operating strategy;
	•	effective allocation and expenditure of capital; and
	•	continuation of oil and gas prices at approximately 2007 levels.

Executive Incentive Compensation Plan Award (EICP) – In February of each year, the Compensation Committee sets a personal target percentage of base salary for each executive officer that will be used to calculate any award earned by the officer under the EICP. In making its determination, the Compensation Committee reviewed cash incentive information derived from a number of compensation surveys. The surveys, which are all commercially available to survey participants, were the Frederic W. Cook & Co. Survey of Long-Term Incentives, Towers Perrin Executive Compensation Data Bank, and Hewitt Associates LLC Executive Total Compensation Measurement. The personal target percentages of base salary that were set for 2007 for Dr. Irani and the other named executive officers were:

	•	Dr. Irani – 165%
	•	Mr. Chazen – 110%
	•	Mr. de Brier – 65%
	•	Mr. Morgan – 70%
	•	Mr. Olson – 70%

Sixty percent of the total target EICP award is based on Occidental’s performance as measured against financial targets established in the first quarter of the year (the “Non-Equity Incentive Portion”). Core, basic earnings per share⁸ was chosen as the financial target for all corporate executives because it provides a clear, readily determinable, commonly accepted measure of annual performance and compensates the executives for current operating performance. The Compensation Committee set the 2007 core, basic earnings per share targets based on an analysis of various projected financial-results scenarios and a review of analysts’ estimates of Occidental’s earnings per share for 2007, which projected oil and gas prices for 2007 would be lower than 2006 levels. The award was determined to be 0 percent if earnings per share fell below $2.50, increasing ratably thereafter, up to 200 percent of target if earnings per share reached $4.00.

The remaining 40 percent of the total target EICP award is the bonus portion, which is based on the Compensation Committee’s subjective assessment of an executive’s handling of certain key performance areas, as well as the executive’s response to unanticipated challenges during the year. Key performance areas include governance and ethical conduct; functional and operating accomplishments; health, environment and safety responsibilities; encouraging diversity; and organizational development.

The following formula is used to calculate the total payout value of the EICP award:

Non-Equity Incentive Portion
[	Base Salary at Year End	X	Personal Target Percentage	X	Non-Equity Incentive Portion of Target (60%)	X	Financial Performance Payout Percentage (0 to 200%)	]
+
Bonus Portion
[	Base Salary at Year End	X	Personal Target Percentage	X	Bonus Portion of Target (40%)	X	Individual Performance Payout Percentage (0 to 200%)	]

At the February 2008 meeting, the Compensation Committee approved the total cash incentive compensation to be paid pursuant to the Executive Incentive Compensation Plan for 2007 based on the core, basic earnings per share achieved and the executives’ accomplishments of their individual performance objectives. The 2007 financial results yielded core, basic earnings per share of $5.28, resulting in a 200 percent payout of the Non-Equity Incentive Portion of the Executive Incentive Compensation Plan award for the named executive officers. Total cash incentive payments to the named executive officers under the Executive Incentive Compensation Plan for 2007, including the bonus portion, ranged from 168 percent to 200 percent of the total target award amounts, and are included in the Summary Compensation Table on page 23. The Compensation Committee also set the core, basic earnings per share target for 2008 Executive Incentive Compensation Plan awards based on an analysis of various projected financial-results scenarios and analysts’ expectations. As a result, the Non-Equity Incentive Portion of the award for 2008 will be 0 percent if earnings per share fall below $5.50, and will increase up to 200 percent of target for earnings per share of $7.00. The Non-Equity Incentive Portion of the award will pay at 100 percent of target for earnings per share of $6.25.

SALARY

Salary is cash-based and constitutes a small portion of each executive’s total compensation. An adjustment to base salary may be considered on an annual basis or in connection with changes in responsibility.

Core, basic earnings per share is computed by deducting the “Significant Items Affecting Earnings” from Occidental’s Net Income and dividing this amount by basic shares outstanding. For a discussion of “Significant Items Affecting Earnings,” see “Management Discussion and Analysis of Financial Condition and Results of Operations” in Occidental’s Annual Report on Form 10-K for the year ended December 31, 2007.

OTHER COMPENSATION AND BENEFITS

Occidental does not have a defined benefit pension program for its salaried employees that would typically provide a fixed monthly retirement payment. However, Occidental has various defined contribution retirement arrangements and other benefits, as follows:

	•	Qualified Plans – All salaried employees paid in U.S. dollars, including the named executive officers, are eligible to participate in one or more tax-qualified, defined contribution plans. The defined contribution retirement plan, which provides for periodic contributions by Occidental based on annual cash compensation and age, up to certain levels pursuant to Internal Revenue Service (IRS) regulations, was implemented as a successor plan to the defined benefit pension plan that was terminated in 1983. For 2007, the defined contribution 401(k) savings plan permitted employees to save a percentage of their annual salary up to the $225,000 limit set by IRS regulations, and the employee pre-tax contribution was limited to $15,500. Employees may direct their contributions to a variety of investments. Occidental generally matches employee contributions with Occidental common stock on a dollar-for-dollar basis, in an amount up to 6 percent of the employee’s base salary. The amounts contributed to the qualified plans on behalf of the named executive officers are detailed under “All Other Compensation” in the Summary Compensation Table on page 23. As of December 31, 2007, the aggregate balances under the qualified plans were $5,138,206 for Dr. Irani, $1,327,562 for Mr. Chazen, $2,609,497 for Mr. de Brier, $3,467,350 for Mr. Morgan and $1,079,756 for Mr. Olson. The named executive officers are fully vested in their account balances under the qualified plans.
	•	Nonqualified Retirement Plans – Occidental’s nonqualified retirement benefits are described on page 30. The amounts contributed to the nonqualified retirement plans on behalf of the named executive officers are detailed under “All Other Compensation” in the Summary Compensation Table on page 23. Company contributions, aggregate earnings and aggregate balances for the named executive officers in the nonqualified retirement plans are included in the Nonqualified Deferred Compensation Table on page 31.
	•	Nonqualified Deferred Compensation Plans – Occidental’s nonqualified deferred compensation plans are described on page 30. The aggregate amounts of salary and bonuses deferred by the named executive officers are included as compensation in the “Salary,” “Bonus” and “Non-Equity Incentive Compensation” columns of the Summary Compensation Table on page 23, as appropriate, in the year of deferral. The above-market portion of the accrued interest on deferred amounts is reported in the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” column of the Summary Compensation Table. Contributions, aggregate earnings and aggregate balances for the named executive officers for the nonqualified deferred compensation plans are shown in the Nonqualified Deferred Compensation Table on page 31.
	•	Deferred Stock Programs – Occidental’s deferred stock programs are described on page 30. Contributions, aggregate earnings, aggregate distributions and aggregate balances for the named executive officers in the 2005 Deferred Stock Program are included in the Nonqualified Deferred Compensation Table on page 31.
	•	Employment Agreements – Employment agreements are offered to key executives for recruitment and retention purposes and to ensure the continuity and stability of management. The employment agreements for Dr. Irani, Mr. Chazen and Mr. de Brier, the only named executive officers with agreements, are discussed under “Potential Payments Upon Termination or Change of Control” on page 32.
	•	Security – Personal security services are provided to executives as recommended by Occidental’s security department. Depending on the perceived risks to the executive, services range from home detection and alarm systems to the provision of around-the-clock personal security guards. The actual out-of-pocket amount paid by Occidental for such services, less any amounts attributable to business travel, appears under “All Other Compensation” in the Summary Compensation Table on page 23.
	•	Tax Preparation and Financial Planning – A select group of executives, including the named executive officers, receive financial planning and investment services, including legal advice related to tax and financial matters, and in Dr. Irani’s case, investment advice. Occidental executives are required to have their personal tax returns prepared by a tax professional qualified to practice before the Internal Revenue Service in order to ensure compliance with applicable tax laws. Any financial planning fees and expenses paid by Occidental on behalf of a specific executive are reflected as taxable income to the executive and are included in the “All Other Compensation” column of the Summary Compensation Table on page 23.
	•	Corporate Aircraft Use – Executives and directors may use corporate aircraft for personal travel, if space is available. The named executive officers and directors reimburse Occidental for personal use of company aircraft, including any guests accompanying them on flights taken for business purposes, at not less than the standard industry fare level rate (which is determined in accordance with IRS regulations). The estimated incremental cost of personal use of the aircraft, less the amount reimbursed by the named executive officers, is included under “All Other Compensation” in the Summary Compensation Table on page 23. Incremental costs include landing fees, fuel and additional flight staff costs, such as hotel accommodations and meals, associated with personal usage.

	•	Insurance – Occidental offers a variety of health coverage options to all employees. Senior executives participate in these plans on the same terms as other employees. In addition, for all employees above a certain grade level, Occidental pays for an annual physical examination. The company provides all salaried employees with life insurance equal to twice the employee’s base salary. For certain senior employees, Occidental increases that to three times base salary. Occidental also provides senior executives with excess liability insurance coverage. The amounts attributable to such benefits are included in the “All Other Compensation” column of the Summary Compensation Table on page 23.
	•	Other – Occidental pays club dues, allows some personal usage of company automobiles, and permits the use of administrative assistants for secretarial services. Occidental and the Compensation Committee believe that while there is some personal benefit to the executives, these items are incidental to the performance of their duties and are reasonable and consistent with the company’s overall compensation program. The amounts attributable to such benefits are included under “All Other Compensation” in the Summary Compensation Table on page 23.

STOCK OWNERSHIP GUIDELINES

The Compensation Committee established stock ownership guidelines for Occidental’s senior management in 1996 and reviewed and updated the guidelines in February 2005. Stock ownership includes stock owned by the officer directly, through Occidental’s Savings Plan and outstanding stock awards under the equity incentive plans. Under the current guidelines, the cumulative ownership targets are 10 times salary for Dr. Irani and five times salary for Messrs. Chazen, de Brier, Morgan and Olson. As of February 29, 2008, all of the named executive officers were in compliance with the guidelines.

EQUITY GRANT PRACTICES

The Compensation Committee grants equity awards at regularly scheduled meetings normally held the day before regularly scheduled Board meetings. Board meeting dates are set in the prior year. The grant date value is based on the closing price on the New York Stock Exchange on the trading day immediately preceding the start of the performance period for PSAs, and on the day the Compensation Committee acts for TSRIs. As specifically authorized by the terms of the 2005 Long-Term Incentive Plan, the Compensation Committee has delegated to the Chairman and Chief Executive Officer the authority to grant awards in the event a new employee is hired between Compensation Committee meeting dates, and an equity award has been deemed to be an important element in persuading the employee to join Occidental. In such cases, the award is generally made on the date the employee starts work. Any such award granted to an executive officer is reported to the Compensation Committee. Dr. Irani has never granted any equity awards to the named executive officers.

INDIVIDUAL COMPENSATION CONSIDERATIONS

Overall, the Compensation Committee concluded that the senior executive management team has consistently delivered exceptional growth in stockholder value as well as superior financial results — both in absolute terms and relative to the performance of other oil and gas companies. The Compensation Committee believes the management team is uniquely qualified to extend Occidental’s superior performance while continually growing stockholder value. Consequently, the Compensation Committee has provided the executives exceptional compensation, both to reward their outstanding performance, and to encourage their continued focus on growth in stockholder value.

The specific considerations for each of the named executives with respect to their 2007 compensation are discussed below. The table accompanying the discussion of each executive’s compensation sets forth the total compensation value at the target level established by the Compensation Committee for such executive for 2007 and, except for Mr. Olson, 2006. In addition to salary, option awards and other compensation, total compensation value includes each performance-based component of compensation at its target award level for the specified year without regard to if and when the award will vest. With respect to the 2007 Performance-Based Incentive Awards presented in the tables below: The amounts stated under Return on Equity-Based Awards are the amounts which could be earned by the named executives at the end of a three-year performance period (July 1, 2007 through June 30, 2010) if Occidental's return on equity for the period were to be 43.5 percent; the actual payout in 2010 could be more or less than the stated amount depending upon actual performance over that period, including no payout at all if Occidental's return on equity were to be less than 33 percent. The amounts stated under Total Stockholder Return-Based Awards are the amounts which could be earned by the named executives at the end of the applicable four-year performance period (2007 through 2011) if Occidental's total stockholder return for the period were to be approximately at the mid-point of total stockholder returns for the peer comparison companies; the actual payout in 2011 could be more or less than the stated amount depending upon actual performance over the performance periods and the price of Occidental stock when the awards are certified for payment, including no payment at all if Occidental's total stockholder return were to be in the bottom third of the peer comparison companies. Accordingly, the amounts shown in the total compensation value tables differ from the amounts reported in the Summary Compensation Table, which includes amounts attributable to equity awards, including options, granted in prior years and which does not include non-equity awards payable in future years.

DR. IRANI - Dr. Irani is the Chairman and Chief Executive Officer of Occidental. Under his leadership, Occidental has grown to become the fourth-largest oil and gas company in the U.S., based on 2006 market capitalization. Dr. Irani sets the strategic direction for Occidental and oversees its implementation.

In setting award levels for Dr. Irani, the Compensation Committee reviewed a number of key performance measures:

	•	INDUSTRY-LEADING OPERATING RESULTS: Occidental has achieved superior operating performance under Dr. Irani’s leadership. For example, income and cash flow per barrel of oil equivalent of $20.75 and $16.82, respectively, in 2006 were the highest among a group of 11 oil and gas companies representing a broad cross-section of the industry.⁹
	•	EXCEPTIONAL GROWTH IN STOCKHOLDER VALUE: Occidental achieved average annual return on equity and cumulative total return to stockholders of 31.3 percent and 144.4 percent, respectively, for the 2004 through 2006 period. For those performance measures, Occidental’s results were in the upper quartile of all major U.S.-based integrated oil and gas companies, including ExxonMobil Corporation, Chevron Corporation and ConocoPhillips Corporation and, for both measures, all other oil and gas companies in the group¹⁰, with the exception of one. During the same three-year period, Occidental’s return on capital employed was higher than that of all other U.S.-based oil and gas companies in such group, except ExxonMobil Corporation. For the period from December 31, 2001, through the end of 2006, Occidental’s stock price increased from approximately $13 per share to approximately $49 per share, and its total cumulative stockholder return was 315 percent. The cumulative total stockholder returns reflected by the S&P 500 Index and the S&P 500 Integrated Oil & Gas Index for this period were 35 percent and 127 percent, respectively. Occidental’s peer group cumulative total stockholder return was 125 percent for the same period. In addition, Occidental’s total market capitalization was approximately $9.9 billion in December 2001 and $41 billion in December 2006.
	•	POSITIONING FOR SIGNIFICANT FUTURE GROWTH: Several years ago, Occidental determined that the Middle East and North Africa should be one of its core strategic areas. Dr. Irani has developed particularly strong relationships with government leaders in a number of Middle East countries. These relationships, which Dr. Irani has personally developed and sustained, represent a competitive advantage for Occidental; and they have enabled the company to establish credibility similar to that enjoyed by significantly larger competitors in being considered for business opportunities. Additionally, under Dr. Irani’s leadership, Occidental has built an effective team that has contributed to Occidental’s success in business development as well as operational projects in the Middle East. For example, in 2007, Occidental:

	o	acquired two additional blocks in Qatar with expected immediate production of 5,000 BOE per day;
	o	was awarded two offshore exploration properties in Bahrain and a major development contract in Libya; and
	o	announced that the Dolphin Project would be fully operational, with expected production to Occidental increasing to approximately 55,000 BOE per day beginning early 2008.

Dr. Irani’s relationships in the region have allowed Occidental to develop insight into the plans and objectives of these Middle East countries; the company believes this will help it to compete successfully for significant future business opportunities, further enhancing stockholder value.

After considering these performance measures, the Compensation Committee concluded that Dr. Irani has added, and will continue to add, significant value to Occidental and its stockholders. Accordingly, the Compensation Committee has provided unique and significant compensation opportunities to Dr. Irani to reward him for these contributions and to ensure his continued leadership. In addition, to further ensure leadership continuity during this period of strategic growth, Dr. Irani’s employment agreement was extended by the Board of Directors until the earlier of the 2015 annual stockholder meeting or May 30, 2015. All other terms remained unchanged.

The components of Dr. Irani’s compensation for 2007 and 2006 as established by the Compensation Committee are set forth below.

Year	Performance-Based Incentive Awards									Option Awards ($)		Non-Performance-Based Compensation								Total Compensation Value ($)
Year	Non-Equity Incentive Compensation Plan Award ($)			Return on Equity-Based Awards ($)			Total Stockholder Return-Based Awards ($)			Option Awards ($)		Salary ($)		Bonus ($)			Other ($)			Total Compensation Value ($)
2007	$	1,287,000	(1)	$	29,250,000	(2)	$	17,895,000	(3)	$	0	$	1,300,000	$	858,000	(4)	$	2,475,582	(5)	$	53,065,582
2006	$	1,170,000		$	25,222,500		$	2,145,000		$	17,724,000	$	1,300,000	$	780,000		$	3,080,936		$	51,422,436

(1)

Dr. Irani’s Non-Equity Incentive Award target, as computed pursuant to the Executive Incentive Compensation Plan formula on page 15, was 99 percent of his base salary and was payable depending upon attainment of the earnings per share target set by the Compensation Committee in February 2007. Because Occidental’s core basic earnings per share for 2007 was $5.28, Dr. Irani’s actual performance-based payout was $2,574,000, which amount is shown in the “Non-Equity Incentive Compensation” column of the Summary Compensation Table on page 23.

(2)

The Return on Equity Incentive Award represents 65 percent of the $45 million target incentive value approved for Dr. Irani in July 2007. For a discussion of the terms of the awards, see page 13 and Grants of Plan-Based Awards on page 24.

9	The companies, in addition to Occidental, were Anadarko Petroleum Corporation, Apache Corporation, BP p.l.c., Chevron Corporation, ConocoPhillips, Devon Energy Corporation, EnCana Corporation, ExxonMobil Corporation, Hess Corporation and Marathon Oil Corporation.
10	The companies were Anadarko Petroleum Corporation, Apache Corporation, BP p.l.c., Chevron Corporation, ConocoPhillips, Devon Energy Corporation, ExxonMobil Corporation, Hess Corporation and Royal Dutch Shell plc.

(3)	Includes a Performance Stock Award granted in December 2006 equal to 165 percent of base salary and a Total Stockholder Return Incentive Award granted in July 2007 equal to 35 percent of the $45 million target incentive value approved for Dr. Irani at that meeting.
(4)	Dr. Irani’s Bonus target, as computed pursuant to the Executive Incentive Compensation Plan formula on page 15, was 66 percent of his base salary. Payout of his bonus is based on the Compensation Committee’s subjective assessment of Dr. Irani’s accomplishment of his objectives for the year. For 2007, his objectives included: enhancing the value of Occidental’s portfolio of assets; improving the quality and consistency of earnings; emphasizing corporate leadership quality by optimizing productivity, communications and incentives; and maintaining focus on Occidental’s commitment to safety, health, the environment, diversity, governance and the highest standards of ethical conduct. In February 2008, the Compensation Committee reviewed his accomplishments, including those described above, and awarded him a bonus equal to 200 percent of target. The Bonus earned for 2007 is shown in the “Bonus” column of the Summary Compensation Table on page 23.
(5)	The amount shown under “Other” is the sum of the amounts included in the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” and “All Other Compensation” columns of the Summary Compensation Table on page 23.

MR. CHAZEN - The Board of Directors elected Mr. Chazen President and Chief Financial Officer on December 13, 2007 and increased his base salary for 2008 to $800,000 in recognition of his additional responsibilities. He had previously served as Senior Executive Vice President and Chief Financial Officer. Mr. Chazen has added oversight of worldwide oil and gas exploration to his responsibilities, which continue to include implementing Occidental’s overall strategy and overseeing corporate development, oil and gas marketing, and the chemical segment, in addition to his duties as Chief Financial Officer.

The components of Mr. Chazen’s compensation for 2007 and 2006 as established by the Compensation Committee are set forth below.

Year	Performance-Based Incentive Awards									Option Awards ($)		Non-Performance-Based Compensation								Total Compensation Value ($)
Year	Non-Equity Incentive Compensation Plan Award ($)			Return on Equity-Based Awards ($)			Total Stockholder Return-Based Awards ($)			Option Awards ($)		Salary ($)		Bonus ($)			Other ($)			Total Compensation Value ($)
2007	$	475,200	(1)	$	13,000,000	(2)	$	7,720,000	(3)	$	0	$	720,000	$	316,800	(4)	$	456,892	(5)	$	22,688,892
2006	$	432,000		$	7,566,750		$	720,000		$	8,507,520	$	720,000	$	288,000		$	531,248		$	18,765,518

(1)	Mr. Chazen’s Non-Equity Incentive Compensation Award target, as computed pursuant to the Executive Incentive Compensation Plan, was 66 percent of his base salary and was payable depending upon attainment of the earnings per share target set by the Compensation Committee in February 2007. Because Occidental’s core basic earnings per share for 2007 was $5.28, Mr. Chazen’s actual performance-based payout was $950,400, which amount is shown in the “Non-Equity Incentive Compensation” column of the Summary Compensation Table on page 23.
(2)	The Return on Equity Incentive Award represents 65 percent of the $20 million target incentive value approved for Mr. Chazen in July 2007. For a discussion of the terms of the awards, see page 13 and Grants of Plan-Based Awards on page 24.
(3)	Includes a Performance Stock Award granted in December 2006 equal to 100 percent of base salary and a Total Stockholder Return Incentive Award granted in July 2007 equal to 35 percent of the $20 million target incentive value approved for Mr. Chazen at that meeting.
(4)	Mr. Chazen’s Bonus target, as computed pursuant to the Executive Incentive Compensation Plan, was 44 percent of his base salary. Payout of his bonus is based on the Compensation Committee’s subjective assessment of Mr. Chazen’s accomplishment of his objectives for the year. For 2007, his objectives included: purchasing additional oil and gas reserves at reasonable prices during the year; ensuring that free cash flow was invested so as to build long-term stockholder value; ensuring adequate succession planning for units under his purview; and maintaining the company’s “A” credit rating. In February 2008, the Compensation Committee reviewed his accomplishments, including those described above, and awarded him a bonus equal to 200 percent of target. The Bonus earned for 2007 is shown in the “Bonus” column of the Summary Compensation Table on page 23.
(5)	The amount shown under “Other” is the sum of the amounts included in the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” and “All Other Compensation” columns of the Summary Compensation Table on page 23.

MR. DE BRIER - Mr. de Brier is Executive Vice President, General Counsel and Corporate Secretary. As Executive Vice President and General Counsel, he is responsible for Occidental’s worldwide legal and compliance functions.

The components of Mr. de Brier’s compensation for 2007 and 2006 as established by the Compensation Committee are set forth below.

Year	Performance-Based Incentive Awards									Option Awards ($)		Non-Performance-Based Compensation								Total Compensation Value ($)
Year	Non-Equity Incentive Compensation Plan Award ($)			Return on Equity-Based Awards ($)			Total Stockholder Return-Based Awards ($)			Option Awards ($)		Salary ($)		Bonus ($)			Other ($)			Total Compensation Value ($)
2007	$	214,890	(1)	$	2,470,000	(2)	$	1,715,700	(3)	$	0	$	551,000	$	143,260	(4)	$	314,549	(5)	$	5,409,399
2006	$	214,890		$	1,816,020		$	385,700		$	2,954,000	$	551,000	$	143,260		$	322,984		$	6,387,854

(1)	Mr. de Brier’s Non-Equity Incentive Compensation Award target, as computed pursuant to the Executive Incentive Compensation Plan, was 39 percent of his base salary and was payable depending upon attainment of the earnings per share target set by the Compensation Committee in February 2007. Because Occidental’s core basic earnings per share for 2007 was $5.28, Mr. de Brier’s actual performance-based payout was $429,780, which amount is shown in the “Non-Equity Incentive Compensation” column of the Summary Compensation Table on page 23.
(2)	The Return on Equity Incentive Award represents 65 percent of the $3.8 million target incentive value approved for Mr. de Brier in July 2007. For a discussion of the terms of the awards, see page 13 and Grants of Plan-Based Awards on page 24.
(3)	Includes a Performance Stock Award granted in December 2006 equal to 70 percent of base salary and a Total Stockholder Return Incentive Award granted in July 2007 equal to 35 percent of the $3.8 million target incentive value approved for Mr. de Brier at that meeting.
(4)	Mr. de Brier’s Bonus target, as computed pursuant to the Executive Incentive Compensation Plan, was 26 percent of his base salary. Payout of his bonus is based on the Compensation Committee’s subjective assessment of Mr. de Brier’s accomplishment of his objectives for the year. For 2007, his objectives included: further refining and upgrading all legal services for Occidental, including all of its business units, with the ultimate objective of providing more effective, practical and successful legal services. In February 2008, the Compensation Committee reviewed his accomplishments, including those described above, and awarded him a bonus equal to 119 percent of target. The Bonus earned for 2007 is shown in the “Bonus” column of the Summary Compensation Table on page 23.
(5)	The amount shown under “Other” is the sum of the amounts included in the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” and “All Other Compensation” columns of the Summary Compensation Table on page 23.

MR. MORGAN - Mr. Morgan is Executive Vice President of Occidental and President, Oxy Oil and Gas – Western Hemisphere. He is responsible for Occidental’s oil and gas operations in the United States and Latin America. In addition, he has worldwide responsibility for the oil and gas segment’s engineering operations and its Health, Environment, Safety and Security programs.

The components of Mr. Morgan’s compensation for 2007 and 2006 as established by the Compensation Committee are set forth below.

Year	Performance-Based Incentive Awards									Option Awards ($)		Non-Performance-Based Compensation								Total Compensation Value ($)
Year	Non-Equity Incentive Compensation Plan Award ($)			Return on Equity-Based Awards ($)			Total Stockholder Return-Based Awards ($)			Option Awards ($)		Salary ($)		Bonus ($)			Other ($)			Total Compensation Value ($)
2007	$	220,500	(1)	$	2,600,000	(2)	$	1,793,750	(3)	$	0	$	525,000	$	147,000	(4)	$	214,833	(5)	$	5,501,083
2006	$	220,500		$	1,816,020		$	393,750		$	2,954,000	$	525,000	$	147,000		$	235,774		$	6,292,044

(1)	Mr. Morgan’s Non-Equity Incentive Compensation Award target, as computed pursuant to the Executive Incentive Compensation Plan, was 42 percent of his base salary and was payable depending upon attainment of the earnings per share target set by the Compensation Committee in February 2007. Because Occidental’s core basic earnings per share for 2007 was $5.28, Mr. Morgan’s actual performance-based payout was $441,000, which amount is shown in the “Non-Equity Incentive Compensation” column of the Summary Compensation Table on page 23.
(2)	The Return on Equity Incentive Award represents 65 percent of the $4 million target incentive value approved for Mr. Morgan in July 2007. For a discussion of the terms of the awards, see page 13 and Grants of Plan-Based Awards on page 24.
(3)	Includes a Performance Stock Award granted in December 2006 equal to 75 percent of base salary and a Total Stockholder Return Incentive Award granted in July 2007 equal to 35 percent of the $4 million target incentive value approved for Mr. Morgan at that meeting.
(4)	Mr. Morgan’s Bonus target, as computed pursuant to the Executive Incentive Compensation Plan, was 28 percent of his base salary. Payout of his bonus is based on the Compensation Committee’s subjective assessment of Mr. Morgan’s accomplishment of his objectives for the year. For 2007, his objectives included: by year-end 2007, improving worldwide drilling performance to first quartile as measured by cost/foot, feet/day and health, environment and safety metrics; negotiating contract extensions in Latin America; meeting or exceeding 2007 Western Hemisphere production average; and achieving first quartile finding and development costs for the Western Hemisphere operations. In February 2008, the Compensation Committee reviewed his accomplishments, including those described above, and awarded him a bonus equal to 142 percent of target. The Bonus earned for 2007 is shown in the “Bonus” column of the Summary Compensation Table on page 23.
(5)	The amount shown under “Other” is the sum of the amounts included in the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” and “All Other Compensation” columns of the Summary Compensation Table on page 23.

MR. OLSON - As Executive Vice President of Occidental and President, Oxy Oil and Gas – Eastern Hemisphere, Mr. Olson is responsible for Occidental’s oil and gas operations other than those in the U.S. and Latin America.

The components of Mr. Olson’s compensation for 2007 as established by the Compensation Committee are set forth below.

Year

Performance-Based Incentive Awards

Option

Awards

($)

Non-Performance-Based Compensation

Total

Compensation

Value

($)

Non-Equity Incentive

Compensation

Plan Award

($)

Return on

Equity-Based

Awards

($)

Total Stockholder

Return-Based

Awards

($)

Salary

($)

Bonus

($)

Other

($)

2007

201,600

(1)

2,600,000

(2)

1,736,000

(3)

480,000

134,400

(4)

138,037

(5)

5,290,037

(1)	Mr. Olson’s Non-Equity Incentive Compensation Award target, as computed pursuant to the Executive Incentive Compensation Plan, was 42 percent of his base salary and was payable depending upon attainment of the earnings per share target set by the Compensation Committee in February 2007. Because Occidental’s core basic earnings per share for 2007 was $5.28. Mr. Olson’s actual performance-based payout was $403,200, which amount is shown in the “Non-Equity Incentive Compensation” column of the Summary Compensation Table on page 23.
(2)	The Return on Equity Incentive Award represents 65 percent of the $4 million target incentive value approved for Mr. Olson in July 2007. For a discussion of the terms of the awards, see page 13 and Grants of Plan-Based Awards on page 24.
(3)	Includes a Performance Stock Award granted in December 2006 equal to 70 percent of base salary and a Total Stockholder Return Incentive Award granted in July 2007 equal to 35 percent of the $4 million target incentive value approved for Mr. Olson at that meeting.
(4)	Mr. Olson’s Bonus target, as computed pursuant to the Executive Incentive Compensation Plan, was 28 percent of his base salary. Payout of his bonus is based on the Compensation Committee’s subjective assessment of Mr. Olson’s accomplishment of his objectives for the year. For 2007, his objectives included: completing agreements on three new growth projects in the Middle East, North Africa and/or the Caspian regions; “on-streaming” the Dolphin Project by June 30, 2007; and achieving first quartile finding and development costs for Eastern Hemisphere operations. In February 2008, the Compensation Committee reviewed his accomplishments, including those described above, and awarded him a bonus equal to 184 percent of target. The Bonus earned for 2007 is shown in the “Bonus” column of the Summary Compensation Table on page 23.
(5)	The amount shown under “Other” is the sum of the amounts included in the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” and “All Other Compensation” columns of the Summary Compensation Table on page 23.

CONSEQUENCES OF MISCONDUCT

In 1997, Occidental’s Board of Directors adopted a Code of Business Conduct that prohibits any officer, employee or director from violating or circumventing any law of the United States or a foreign country during the course of his or her employment. The Audit Committee of the Board of Directors oversees compliance with the Code of Business Conduct and has put in place procedures, including a compliance hotline, to ensure that all violations or suspected violations of the Code of Business Conduct are reported promptly, without fear of retaliation. If a named executive officer were found to have violated the Code of Business Conduct, the officer would be subject to disciplinary action, which may include termination, referral for criminal prosecution and reimbursement to Occidental or others for any losses or damages resulting from the violation.

TAX AND ACCOUNTING CONSIDERATIONS

Section 162(m) of the U.S. Internal Revenue Code of 1986, as amended, places a limit of $1 million on the amount of compensation that Occidental may deduct in any one year with respect to each of its five highest-paid executive officers, other than the Chief Financial Officer. Certain performance-based compensation elements approved by stockholders are not subject to the deduction limit. Although tax consequences are considered in its compensation decisions, the Compensation Committee has not adopted a policy that all compensation must be deductible. Rather, the Compensation Committee gives priority to the overall compensation objectives discussed above.

It is expected that performance-based equity awards (PSAs and TSRIs) will not be subject to the deduction limits prescribed by Section 162(m) of the Internal Revenue Code.

As noted in the discussion of Nonqualified Deferred Compensation, Occidental amended its deferred compensation plans, which became the Modified Deferred Compensation Plan, in 2006. In connection with such amendments, participants were given the option to change distribution elections.

Distributions made out of the Modified Deferred Compensation Plan in 2007 decreased the interest expense for 2007 by approximately $2.7 million and is expected to decrease the interest expense by approximately $6 million per year in 2008 and future years. The plan modifications made with respect to interest rates will result in interest expense savings to Occidental on the remaining balances in 2009 and in future years.

COMPENSATION COMMITTEE REPORT

The Executive Compensation and Human Resources Committee of the Board has reviewed and discussed with management the Compensation Discussion and Analysis for the year ended December 31, 2007, including the Committee’s commitment to pay for performance and the decisions made by the Executive Compensation and Human Resources Committee that recognize the exceptional performance of Occidental under the leadership of Dr. Irani and the other named executive officers. Based on these reviews and discussions, the Executive Compensation and Human Resources Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the Proxy Statement for the 2008 Annual Meeting of Stockholders.

Respectfully submitted,

THE EXECUTIVE COMPENSATION AND

HUMAN RESOURCES COMMITTEE

John S. Chalsty (Chair)

Spencer Abraham

R. Chad Dreier

Irvin W. Maloney

Rodolfo Segovia

Rosemary Tomich

PERFORMANCE GRAPH

The following graph compares the yearly percentage change in Occidental’s cumulative total return on its common stock with the cumulative total return of the Standard & Poor's 500 Stock Index and with that of Occidental’s peer group over the five-year period ended on December 31, 2007. The graph assumes that $100 was invested in Occidental common stock, in the stock of the companies in the Standard & Poor's 500 Index and in a portfolio of the peer group companies weighted by their relative market values each year and that all dividends received were reinvested.

In 2007, Occidental revised its peer group by including two international-based oil and gas companies to reflect the peer companies that Occidental competes against for major global projects and removing Hess Corporation, which is a smaller company with significant refining operations. The revised peer group consists of Anadarko Petroleum Corporation, Apache Corporation, BP p.l.c., Chevron Corporation, ConocoPhillips, Devon Energy Corporation, ExxonMobil Corporation, Royal Dutch Shell plc and Occidental. Analysis for the revised peer group includes five years of historical performance data as noted above for the common stock of each of the companies. The peer group used in the analysis last year consisted of Anadarko Petroleum Corporation, Apache Corporation, Chevron Corporation, ConocoPhillips, Devon Energy Corporation, ExxonMobil Corporation, Hess Corporation and Occidental.

	12/31/02	12/31/03	12/31/04	12/31/05	12/31/06	12/31/07
Occidental	$100	$153	$216	$301	$374	$599
Prior Peer Group	100	126	163	194	255	333
Revised Peer Group	100	125	156	182	226	283
S&P 500	100	129	143	150	173	183

The information provided in this Performance Graph shall not be deemed “soliciting material” or “filed” with the Securities and Exchange Commission or subject to regulation 14A or 14C under the Securities Exchange Act of 1934 (“Exchange Act”), other than as provided in Item 201 to Regulation S-K under the Exchange Act, or subject to the liabilities of Section 18 of the Exchange Act and shall not be deemed incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act except to the extent Occidental specifically requests that it be treated as soliciting material or specifically incorporates it by reference.

EXECUTIVE COMPENSATION TABLES

Set forth below are tables showing for Dr. Irani, Occidental’s principal executive officer, Mr. Chazen, Occidental’s principal financial officer, and the three other highest-paid executive officers of Occidental serving as executive officers on December 31, 2007: (1) in summary form, the compensation attributed to such executives for 2007 and, except for Mr. Olson, 2006, including the compensation cost related to the portion of stock and option awards granted in 2007 and in prior years that are reported as compensation expense in Occidental’s 2007 and 2006 Consolidated Financial Statements; (2) the equity and non-equity incentive awards granted to such executives in 2007; (3) the outstanding equity awards held by such executives as of December 31, 2007; (4) the options exercised by such executives and their stock awards vested; and (5) the required information related to the nonqualified deferred compensation plans for such executives. The compensation tables should be read in conjunction with the Compensation Discussion and Analysis (see page 10), which explains Occidental’s compensation plans and philosophy and provides information about the compensation decisions made with respect to the named executive officers for 2007.

SUMMARY COMPENSATION TABLE

The table below and the accompanying footnotes summarize the compensation attributed to the chief executive officer, chief financial officer and the three other highest-paid executives in 2007 and 2006, including the compensation cost related to the stock and option awards granted in 2002 through 2007 (no option awards were granted in 2007) that are reported as compensation expense in Occidental’s 2007 and 2006 Consolidated Financial Statements. The amounts expensed for the stock and option awards in 2007 reflect the approximately 58 percent appreciation in the year-end closing price of Occidental’s common stock from $48.83 for 2006 to $76.99 for 2007, the increased probability of attaining the performance measures for performance-based stock awards and vesting of non-performance-based stock awards. For Dr. Irani and Messrs. Chazen, de Brier, Morgan and Olson, approximately $31.8 million, $12.6 million, $4.0 million, $2.0 million and $1.3 million, respectively, of the amount shown for such officer for 2007 in the “Total” column of the Summary Compensation Table is due to the effect of the increased price of the common stock and the increased probability of attaining the performance measures (see footnotes (2) and (3) below). The “Non-Equity Incentive Compensation” column of the Summary Compensation Table does not include any amounts for the Return on Equity Incentive Awards granted for 2007, which will vest in 2011, because such awards have not yet been earned.

Summary Compensation Table
Name and Principal Position	Year	Salary ($)			Bonus ($) (1)			Stock Awards ($) (2)		Option Awards ($) (3)		Non-Equity Incentive Compensation ($) (4)			Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) (5)		All Other Compensation ($)			Total ($)
Ray R. Irani, Chairman and Chief Executive Officer	2007	$	1,300,000		$	1,716,000		$	37,175,835	$	32,387,328	$	2,574,000		$	584,168	$	1,891,414	(6)	$	77,628,745
Ray R. Irani, Chairman and Chief Executive Officer	2006		1,300,000			1,396,000			30,995,422		17,372,169		1,404,000			601,693		2,479,243			55,548,527
Stephen I. Chazen, President and Chief Financial Officer	2007	$	720,000		$	633,600		$	11,722,832	$	15,350,578	$	950,400		$	201,158	$	255,734	(7)	$	29,834,302
	2006		720,000			482,000	(8)		9,142,299		8,408,317		518,000	(8)		137,457		393,791			19,801,864
Donald P. de Brier, EVP, General Counsel and Secretary	2007	$	551,000		$	170,220		$	3,659,202	$	4,950,598	$	429,780		$	80,544	$	234,005	(9)	$	10,075,349
	2006		551,000			192,000	(10)		3,876,056		3,309,577		258,000	(10)		74,715		248,269			8,509,617
John W. Morgan, EVP and President – Oil and Gas, Western Hemisphere	2007	$	525,000		$	209,000		$	3,636,105	$	3,020,996	$	441,000		$	61,441	$	153,392	(11)	$	8,046,934
	2006		525,000	(12)		135,000			3,512,978		3,293,562		265,000			31,976		203,798			7,967,314
R. Casey Olson, EVP and President – Oil and Gas, Eastern Hemisphere	2007	$	480,000		$	246,800		$	3,000,899	$	2,001,732	$	403,200			–	$	138,037	(13)	$	6,270,668

(1)	The amounts shown represent the discretionary portion of the executive’s annual Executive Incentive Compensation Plan award.
(2)	The amounts in the “Stock Awards” column include the compensation cost for 2007 and 2006 related to stock awards granted in 2007 and 2006 and in prior years, computed in accordance with Statement of Financial Accounting Standard No. 123 (Revised 2004), “Share-Based Payment” (“FAS 123(R)”). See Note 12 to the Consolidated Financial Statements in Occidental’s Annual Reports on Form 10-K for the years ended December 31, 2007, and December 31, 2006, regarding assumptions underlying valuation of equity awards. Of the amounts shown for 2007 in the column, approximately $1.9 million, $0.8 million, $0.2 million, $0.2 million and $0.2 million, for Dr. Irani and Messrs. Chazen, de Brier, Olson and Morgan, respectively, is attributable to amounts expensed for awards granted for 2007, and the balance represents the current year’s expense of awards granted for the prior five years. Of the amounts shown for 2007 in the column with respect to awards granted for years prior to 2007, approximately $11.9 million, $3.5 million, $1.3 million, $1.2 million and $1.1 million for Dr. Irani and Messrs. Chazen, de Brier, Morgan and Olson, respectively, were attributable to the increased price of the stock at year end and the increased probability that higher performance levels would be attained.
	See “Grants of Plan-Based Awards” on page 24 for information about equity awards for 2007 and “Outstanding Equity Awards at December 31, 2007” for information with respect to awards outstanding at year end. The ultimate payout value may be significantly more or less than the amounts shown, with the possibility of no payout, depending on the outcome of the performance criteria in the case of PSAs, TSRIs and Performance-based Restricted Stock Units and the price of Occidental stock at the end of the performance or restricted period. For a description of the performance criteria, see “Compensation Discussion and Analysis” on page 10.

(3)	The amounts in the “Option Awards” column include the compensation cost for 2007 and 2006 related to option awards granted in 2006 and in prior years, computed in accordance with FAS 123(R). See Note 12 to Consolidated Financial Statements in Occidental’s Annual Reports on Form 10-K for the years ended December 31, 2007 and December 31, 2006, regarding assumptions underlying valuation of equity awards. Of the amounts shown for 2007 in the column, approximately $19.9 million, $9.1 million, $2.7 million, $0.8 million and $0.2 million for Dr. Irani and Messrs. Chazen, de Brier, Morgan and Olson, respectively, were attributable to the increased price of the common stock at year end.
	See “Grants of Plan-Based Awards” on page 24 for information about equity awards granted for 2007 and “Outstanding Equity Awards at December 31, 2007” for information with respect to awards outstanding at year end.
	The ultimate payout value may be significantly more or less than the amounts shown, with the possibility of no payout, depending on the price of Occidental stock during the term of the option award.
(4)	The amounts represent the performance-based portion of the executive’s annual Executive Incentive Compensation Plan award. The payout was determined based on Occidental’s attainment of specified earnings per share targets. For information on the amounts earned for 2007, see “Compensation Discussion and Analysis” on page 10.
(5)	The amounts represent the above-market portion of interest the executives earned during the year on their nonqualified deferred compensation balances (see page 30 for a description of the Nonqualified Deferred Compensation Plans).
(6)	Includes $13,500 credited pursuant to the Occidental Petroleum Corporation Savings Plan (the “Savings Plan”); $551,625 credited pursuant to the Occidental Petroleum Corporation Supplemental Retirement Plan II (the “Supplemental Retirement Plan”) described on page 30; $135,035 for life insurance premiums; and $1,191,254 in the aggregate for personal benefits. Personal benefits include security services ($774,756); tax preparation and financial planning services; airplane usage; administrative assistance; club dues; and excess liability insurance. Personal benefits are described beginning on page 16.
(7)	Includes $13,500 credited pursuant to the Savings Plan; $231,225 credited pursuant to the Supplemental Retirement Plan; and $11,009 for life insurance premiums.
(8)	Mr. Chazen elected to defer $500,000 of the aggregate amounts shown in the “Bonus” and “Non-Equity Incentive Plan Compensation” columns for 2006.
(9)	Includes $13,500 credited pursuant to the Savings Plan; $134,805 credited pursuant to the Supplemental Retirement Plan; $50,090 for life insurance premiums; and $35,610 in the aggregate for personal benefits. Personal benefits include security services; tax preparation and financial counseling; club dues and excess liability insurance. Personal benefits are described beginning at page 16.
(10)	Mr. de Brier elected to defer 100 percent of the aggregate amounts shown in the “Bonus” and “Non-Equity Incentive Plan Compensation” columns for 2006.
(11)	Includes $13,500 credited pursuant to the Savings Plan; $124,125 credited pursuant to the Supplemental Retirement Plan; $15,767 for life insurance premiums.
(12)	Mr. Morgan elected to defer $192,000 of his 2006 salary.
(13)	Includes $13,500 credited pursuant to the Savings Plan; $122,025 credited pursuant to the Supplemental Retirement Plan; $2,512 for life insurance premiums.

GRANTS OF PLAN-BASED AWARDS

The table below summarizes the plan-based awards granted by the Compensation Committee to the named executive officers for 2007: Executive Incentive Compensation Plan (Non-Equity Incentive Portion) — EICP, Performance Stock Award — PSA, Total Stockholder Return Incentive Awards — TSRI, Return on Equity Incentive Awards — ROEI. Immediately following the table is a summary of key terms of the award agreements.

For additional information on the performance objectives and determination of threshold, target and maximum payouts for these awards, see Compensation Discussion and Analysis beginning on page 10. For the actual amounts earned under the EICP awards, see the Summary Compensation Table on page 23.

The equity incentive awards listed below are the only stock awards granted to the named executive officers for 2007. No option awards or non-performance-based stock awards were granted in 2007.

Grants of Plan-Based Awards
Name/ Type of Grant (1)	Grant Date (2)	Date Awarded by Compen- sation Committee	Estimated Future Payouts Under Non-Equity Incentive Plan Awards						Estimated Future Payouts Under Equity Incentive Plan Awards			All Other Stock Awards Number of Shares or Units (# shares)	All Other Option Awards: Number of Securities Underlying Options (# shares)	Exercise or Base Price of Option Awards ($)	Grant Date Fair Value of Stock and Option Awards ($) (3)
Name/ Type of Grant (1)	Grant Date (2)	Date Awarded by Compen- sation Committee	Threshold $		Target $		Maximum $		Threshold # shares	Target # shares	Maximum # shares			Exercise or Base Price of Option Awards ($)
Ray R. Irani
EICP ⁽⁴⁾	1/1/07	2/14/07	$	17,160	$	1,287,000	$	2,574,000
PSA ⁽⁵⁾	1/1/07	12/11/06							14,497	43,928	87,856				$	4,887,429
TSRI ⁽⁶⁾	7/18/07	7/18/07							2,543	254,320	381,480				$	21,256,066
ROEI ⁽⁷⁾	7/18/07	7/18/07	$	292,500	$	29,250,000	$	58,500,000
Stephen I. Chazen
EICP ⁽⁴⁾	1/1/07	2/14/07	$	6,336	$	475,200	$	950,400
PSA ⁽⁵⁾	1/1/07	12/11/06							4,867	14,746	29,492				$	1,640,640
TSRI ⁽⁶⁾	7/18/07	7/18/07							1,130	113,031	169,547				$	9,447,131
ROEI ⁽⁷⁾	7/18/07	7/18/07	$	130,000	$	13,000,000	$	26,000,000
Donald P. de Brier
EICP ⁽⁴⁾	1/1/07	2/14/07	$	2,865	$	214,890	$	429,780
PSA ⁽⁵⁾	1/1/07	12/11/06							2,607	7,899	15,798				$	878,843
TSRI ⁽⁶⁾	7/18/07	7/18/07							215	21,476	32,214				$	1,794,964
ROEI ⁽⁷⁾	7/18/07	7/18/07	$	24,700	$	2,470,000	$	4,940,000
John W. Morgan
EICP ⁽⁴⁾	1/1/07	2/14/07	$	2,940	$	220,500	$	441,000
PSA ⁽⁵⁾	1/1/07	12/11/06							2,662	8,064	16,128				$	897,201
TSRI ⁽⁶⁾	7/18/07	7/18/07							226	22,607	33,911				$	1,889,493
ROEI ⁽⁷⁾	7/18/07	7/18/07	$	26,000	$	2,600,000	$	5,200,000
R. Casey Olson
EICP ⁽⁴⁾	1/1/07	2/14/07	$	2,688	$	201,600	$	403,200
PSA ⁽⁵⁾	1/1/07	12/11/06							2,272	6,882	13,764				$	765,691
TSRI ⁽⁶⁾	7/18/07	7/18/07							226	22,607	33,911				$	1,889,493
ROEI ⁽⁷⁾	7/18/07	7/18/07	$	26,000	$	2,600,000	$	5,200,000

(1)	Executive Incentive Compensation Plan (Non-equity incentive portion) — EICP, Performance Stock Award — PSA, Total Stockholder Return Incentive Awards — TSRI, Return on Equity Incentive Awards — ROEI.
(2)	The date in this column for EICP awards is the date the performance period for the awards started. For equity awards, the date in this column is the grant date recognized pursuant to FAS 123(R) which, except for PSAs, is the same as the date the award was granted by the Compensation Committee.
(3)	The amounts shown assume maximum payout is achieved. Actual payout may range from $0 to the maximum.
(4)	Payout at threshold assumes earnings per share of $2.50.
(5)	Awards earned in excess of target will be paid out in cash in an amount equal to the closing price of the common stock on the New York Stock Exchange on the date when attainment of the performance award is certified. Payout at threshold is 33 percent.
(6)	Awards will be paid out 50 percent in stock and 50 percent in cash in an amount equal to the closing price of the common stock on the New York Stock Exchange on the date when attainment of the performance goals is certified. Payout at threshold is shown at 1 percent.
(7)	Payout at threshold is shown at 1 percent.

Summary of Award Terms
	Executive Incentive Compensation Plan (Non-Equity Incentive Portion)	Performance Stock Award	Total Stockholder Return Incentive Awards	Return on Equity Incentive Awards
PERFORMANCE MEASURE	Earnings per Share	Total Stockholder Return	Total Stockholder Return	Return on Equity
PERFORMANCE PERIOD	1 year	4 years	4 years	3 years
FORM OF PAYMENT	Cash	Stock/Cash ⁽¹⁾	Stock/Cash ⁽²⁾	Cash
DIVIDEND EQUIVALENT	No	During the performance period, dividend equivalents are paid to the grantee in cash on the target shares in an amount equal to the dividend declared per share of common stock.	During the performance period, dividend equivalents are paid to the grantee in cash on the target shares in an amount equal to the dividend declared per share of common stock.	No
FORFEITURE PROVISION	The Chief Executive Officer or President may determine eligibility for target awards and any payout to participants who exit employment during the Plan year.	If the grantee dies, becomes disabled, retires or is terminated for the convenience of Occidental during the performance period, then the grantee will forfeit a pro rata portion of the payout based on the days remaining in the performance period after the termination event.	If the grantee dies, becomes disabled, retires or is terminated for the convenience of Occidental during the performance period, then the grantee will forfeit a pro rata portion of the payout based on the days remaining in the performance period after the termination event.	If the grantee dies, becomes disabled, retires or is terminated for the convenience of Occidental during the performance period, then the grantee will forfeit a pro rata portion of the payout based on the days remaining in the performance period after the termination event.
CHANGE IN CONTROL	The Chief Executive Officer may approve an amendment to Plan as a result of acquisition, divestiture or merger with Oxy.	In the event of a Change in Control (as defined in the 2005 Long-Term Incentive Plan) ⁽³⁾, the grantee's right to receive the number of target shares becomes nonforfeitable.	In the event of a Change in Control (as defined in the 2005 Long-Term Incentive Plan) ⁽³⁾, the grantee's right to receive the number of target shares becomes nonforfeitable.	In the event of a Change in Control (as defined in the 2005 Long-Term Incentive Plan) ⁽³⁾, the grantee's right to receive cash equal to the target incentive amount becomes nonforfeitable.

(1)	Awards earned in excess of the target shares will be paid out in cash in an amount equal to the closing price of the common stock on the New York Stock Exchange on the date when attainment of the performance goals is certified.
(2)	Fifty percent of the awards earned will be paid out in cash in an amount equal to the closing price of the common stock on the New York Stock Exchange on the date when attainment of the performance goals is certified, and the balance will be paid in common stock.
(3)	A Change in Control Event under the 2005 Long-Term Incentive Plan generally includes a 20 percent or more change in ownership, certain changes in a majority of the Board, certain mergers or consolidations, sale of substantially all of Occidental’s assets or stockholder approval of a liquidation of Occidental.

OUTSTANDING EQUITY AWARDS AT DECEMBER 31, 2007

The following table sets forth the outstanding option awards and stock awards held by the named executive officers as of December 31, 2007, including options, Stock Appreciation Rights (SAR), Restricted Stock Units (RSU), Performance-Based Restricted Stock Units (PRSU), Performance Stock Awards (PSA) and Total Stockholder Return Incentives (TSRI). These were granted to the named executive officers over a period of several years, including 2007. The FAS 123(R) grant date fair values for the awards granted in 2007 are shown in the “Grants of Plan-Based Awards” table above. The portion of such awards reported as compensation expense in Occidental’s 2007 Consolidated Financial Statements is a component of the current year total compensation for each of the named executives. For a description of the performance criteria for equity plan awards made in 2007, see Compensation Discussion and Analysis on page 10.

Outstanding Equity Awards at December 31, 2007
		Option Awards					Stock Awards
Name/Type of Award (1)	Grant Date	Number of Securities Underlying Unexercised Options (#) Exercisable	Number of Securities Underlying Unexercised Options (#) Unexercisable	Option Exercise Price ($)		Option Expiration Date	Number of Shares or Units of Stock That Have Not Vested (#)		Market Value of Shares or Units of Stock That Have Not Vested ($) (2)		Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (2)
Ray R. Irani
Options	7/16/03	6,424		$	15.565	7/16/13
Options/SAR	7/14/04	1,400,000		$	24.660	7/14/14
SAR/RSU	7/13/05	1,000,000	500,000 ⁽³⁾	$	40.805	7/13/15	200,000	⁽⁴⁾	$	15,398,000
SAR/PRSU	7/19/06	400,000	800,000 ⁽⁵⁾	$	50.445	7/19/16					500,000	^(6,7)	$	38,495,000	⁽⁶⁾
RSU	12/8/03						40,000	⁽⁸⁾	$	3,079,600
RSU	12/6/04						64,000	⁽⁹⁾	$	4,927,360
RSU	12/5/05						92,400	⁽¹⁰⁾	$	7,113,876
PSA	1/1/04										138,495	⁽¹¹⁾	$	10,662,730	⁽¹¹⁾
PSA	1/1/05										133,656	^(12,13)	$	10,290,175	⁽¹²⁾
PSA	1/1/06										107,412	^(12,14)	$	8,269,650	⁽¹²⁾
PSA	1/1/07										87,856	^(12,15)	$	6,764,033	⁽¹²⁾
TSRI	7/18/07										381,480	^(12,16)	$	29,370,145	⁽¹²⁾
Stephen I. Chazen
Options/SAR	7/14/04	635,946		$	24.660	7/14/14
Options/SAR/RSU	7/13/05	533,334	266,666 ⁽³⁾	$	40.805	7/13/15	66,666	⁽⁴⁾	$	5,132,615
SAR/PRSU	7/19/06	192,000	384,000 ⁽⁵⁾	$	50.445	7/19/16					150,000	^(6,7)	$	11,548,500	⁽⁶⁾
RSU	12/8/03						12,000	⁽⁸⁾	$	923,880
RSU	12/6/04						24,000	⁽⁹⁾	$	1,847,760
RSU	12/5/05						33,600	⁽¹⁰⁾	$	2,586,864
PSA	1/1/04										29,832	⁽¹¹⁾	$	2,296,766	⁽¹¹⁾
PSA	1/1/05										44,416	^(12,13)	$	3,419,588	⁽¹²⁾
PSA	1/1/06										36,056	^(12,14)	$	2,775,951	⁽¹²⁾
PSA	1/1/07										29,492	^(12,15)	$	2,270,589	⁽¹²⁾
TSRI	7/18/07										169,547	^(12,16)	$	13,053,424	⁽¹²⁾
Donald P. de Brier
Options	7/16/03	200,000		$	15.565	7/16/13
Options/SAR	7/14/04	200,000		$	24.660	7/14/14
SAR/RSU	7/13/05	186,667	93,333 ⁽³⁾	$	40.805	7/13/15	16,000	⁽⁴⁾	$	1,231,840
SAR/PRSU	7/19/06	66,667	133,333 ⁽⁵⁾	$	50.445	7/19/16					36,000	^(6,7)	$	2,771,640	⁽⁶⁾
RSU	12/8/03						6,000	⁽⁸⁾	$	461,940
RSU	12/6/04						7,200	⁽⁹⁾	$	554,328
RSU	12/5/05						7,200	⁽¹⁰⁾	$	554,328
PSA	1/1/04										27,396	⁽¹¹⁾	$	2,109,218	⁽¹¹⁾
PSA	1/1/05										26,436	^(12,13)	$	2,035,308	⁽¹²⁾
PSA	1/1/06										19,316	^(12,14)	$	1,487,139	⁽¹²⁾
PSA	1/1/07										15,798	^(12,15)	$	1,216,288	⁽¹²⁾
TSRI	7/18/07										32,214	^(12,16)	$	2,480,156	⁽¹²⁾

Outstanding Equity Awards at December 31, 2007
		Option Awards					Stock Awards
Name/Type of Award (1)	Grant Date	Number of Securities Underlying Unexercised Options (#) Exercisable	Number of Securities Underlying Unexercised Options (#) Unexercisable	Option Exercise Price ($)		Option Expiration Date	Number of Shares or Units of Stock That Have Not Vested (#)		Market Value of Shares or Units of Stock That Have Not Vested ($) (2)		Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (2)
John W. Morgan
SAR/RSU	7/13/05		93,333 ⁽³⁾	$	40.805	7/13/15	18,000	⁽⁴⁾	$	1,385,820
SAR/PRSU	7/19/06		133,333 ⁽⁵⁾	$	50.445	7/19/16					36,000	^(6,7)	$	2,771,640	⁽⁶⁾
RSU	12/8/03						5,600	⁽⁸⁾	$	431,144
RSU	12/6/04						8,000	⁽⁹⁾	$	615,920
RSU	12/5/05						9,600	⁽¹⁰⁾	$	739,104
PSA	1/1/04										23,118	⁽¹¹⁾	$	1,779,855	⁽¹¹⁾
PSA	1/1/05										26,988	^(12,13)	$	2,077,806	⁽¹²⁾
PSA	1/1/06										19,720	^(12,14)	$	1,518,243	⁽¹²⁾
PSA	1/1/07										16,128	^(12,15)	$	1,241,695	⁽¹²⁾
TSRI	7/18/07										33,911	^(12,16)	$	2,610,808	⁽¹²⁾
R. Casey Olson
SAR/RSU	7/13/05		66,666 ⁽³⁾	$	40.805	7/13/15	16,666	⁽⁴⁾	$	1,283,115
SAR/PRSU	7/19/06	66,667	133,333 ⁽⁵⁾	$	50.445	7/19/16					36,000	^(6,7)	$	2,771,640	⁽⁶⁾
RSU	12/5/05						8,400	⁽¹⁰⁾	$	646,716
PSA	1/1/04										12,141	⁽¹¹⁾	$	934,736	⁽¹¹⁾
PSA	1/1/05										15,424	^(12,13)	$	1,187,494	⁽¹²⁾
PSA	1/1/06										14,424	^(12,14)	$	1,110,504	⁽¹²⁾
PSA	1/1/07										13,764	^(12,15)	$	1,059,690	⁽¹²⁾
TSRI	7/18/07										33,911	^(12,16)	$	2,610,808	⁽¹²⁾

(1)	Stock Appreciation Rights (SAR), Restricted Stock Units (RSU), Performance-Based Restricted Stock Units (PRSU), Performance Stock Awards (PSA) and Total Stockholder Return Incentives (TSRI)
(2)	The amounts shown represent the product of the number of shares or units shown in the column immediately to the left and the closing price on December 31, 2007 of Occidental common stock as reported in the NYSE Composite Transactions, which was $76.99.
(3)	The SAR vests July 13, 2008.
(4)	The RSU vests July 13, 2008.
(5)	The SAR vests 50 percent per year on July 19, 2008 and July 19, 2009.
(6)	The amounts shown for the PRSU assume target payout is achieved. The ultimate payout value may be higher or lower than the amount shown, with the possibility of no payout, depending on the outcome of the performance criteria and the value of Occidental stock at payout. For PRSUs, performance is determined on the basis of Occidental’s return on equity between July 1, 2006 through June 30, 2009.
(7)	The performance and vesting periods for the PRSUs end June 30, 2009 and July 18, 2009, respectively.
(8)	The RSU vests December 8, 2008.
(9)	The RSU vests 50 percent per year on December 6, 2008, and December 6, 2009.
(10)	The RSU vests 33 1/3 percent per year on December 5, 2008, December 5, 2009, and December 5, 2010.
(11)	Performance for all PSAs depends upon the ranking of Occidental’s Total Stockholder Return compared to the peer companies specified in the award agreement. The performance period for the PSAs ended December 31, 2007. Payout of the PSA at the number of shares shown (150 percent of target for all of the named executives, except Mr. Olson, for whom it was 157 percent) was certified at the February 2008 meeting of the Compensation Committee. See Compensation Discussion and Analysis on page 10.
(12)	Payout value as shown assumes maximum payout. However, the ultimate payout may be significantly less than the amounts shown, with the possibility of no payout, depending on the outcome of the performance criteria and the value of Occidental stock at payout.
(13)	The performance period for the PSA ends December 31, 2008.
(14)	The performance period for the PSA ends December 31, 2009.
(15)	The performance period for the PSA ends December 31, 2010.
(16)	The performance period for the TSRI ends July 17, 2011.

OPTION EXERCISES AND STOCK VESTED IN 2007

The following table summarizes, for the named executive officers, the options exercised and the stock awards vested during 2007, including Performance Stock Awards for which the performance period ended December 31, 2006, but which were not eligible for payment until certification by the Compensation Committee in 2007. The amounts reported as value realized are shown on a before-tax basis. The actual number of shares received upon exercise of options by the named executive officers is less than the number of options exercised, because of the deduction of the exercise price and withholding for taxes, and because certain stock appreciation rights settled in cash rather than shares. Each of the option awards was issued at an exercise price, which was the closing price of Occidental’s common stock on the New York Stock Exchange on the applicable grant date. Therefore, the value realized on exercise reflects in its entirety the significant appreciation in the price of Occidental’s common stock from the option grant date to the date of exercise. Each of the named executives who exercised during 2007 received his option awards on various dates between 2001 and 2006, a period when significant increases were achieved in Occidental’s total market capitalization and the Occidental common stock price. For the named executive officers other than Mr. Olson, option awards were reported in prior years’ proxy statements at the time they were granted.

The stock awards that vested in 2007 were issued to the named executive officers between 2002 and 2006. During the period from 2002 through 2007, Occidental’s total market capitalization increased from approximately $10.7 billion to $63.6 billion. The value realized on vesting includes the appreciation in Occidental’s common stock price after the dates when the stock awards were granted. Occidental’s common stock price increased from approximately $14.15 on January 2, 2003, to $76.99 on December 31, 2007.

Previously Granted Vested Option Awards Exercised and Previously Granted Stock Awards Vested in 2007
	Option Awards				Stock Awards
Name	Number of Shares Acquired on Exercise (#)	Value Realized on Exercise ($) (1)			Number of Shares Acquired on Vesting (#) (2)	Value Realized on Vesting ($) (3)
Ray R. Irani	0	$	0		785,634	$	46,922,559	(4)
Stephen I. Chazen	4,054	$	123,972	(5)	225,584	$	13,875,157	(6)
Donald P. de Brier	466,378	$	20,468,455	(7)	110,232	$	6,340,224	(8)
John W. Morgan	613,334	$	18,399,755	(9)	96,568	$	5,538,241	(10)
R. Casey Olson	102,027	$	2,601,252	(11)	49,614	$	2,830,917	(12)

(1)	Represents the difference between the closing price of the common stock on the New York Stock Exchange on the exercise date and the option exercise price multiplied by the number of shares exercised.
(2)	The following table shows, for each of the named executive officers, the number of restricted stock units that vested during 2007 and performance stock awards that were certified for payment in February 2007 after the expiration of the performance period on December 31, 2006. The PSAs paid out at 200 percent of target. The amount above target was settled in cash.

Name	RSUs (#)	PSAs (#)
Ray R. Irani	511,466	274,168
Stephen I. Chazen	166,532	59,052
Donald P. de Brier	56,000	54,232
John W. Morgan	50,800	45,768
R. Casey Olson	27,466	22,148

(3)	Represents the product of the number of shares vested and the closing price of the common stock on the New York Stock Exchange on the vesting date. With respect to RSUs for which the vesting date fell on a non-trading day, the value was calculated using the closing price on the immediately preceding trading day.
(4)	Includes $6,593,740, which represents the value of performance stock award shares settled in cash; and $33,735,078, which represents the value of the restricted stock units that were mandatorily deferred.
(5)	The options exercised were granted in 2004 with an exercise price of $24.66 per share.
(6)	Includes $1,420,201, which represents the value of performance stock award shares settled in cash, which was deferred; $1,420,201, which represents the value of performance stock award shares that were deferred; and $11,034,755, which represents the value of the restricted stock units that were mandatorily deferred.
(7)	The options and SARs exercised were granted between 2001 and 2004 and with exercise prices ranging from $13.215 to $24.66 per share. Includes $7,751,608, representing the value of shares canceled to satisfy taxes.
(8)	Includes $1,304,280, which represents the value of performance stock award shares settled in cash; and $3,731,664, which represents the value of the restricted stock units that were mandatorily deferred.
(9)	The options and SARs exercised were granted between 2003 and 2006 with exercise prices ranging from $15.565 to $50.445 per share. Includes $6,352,046 representing the value of shares canceled to satisfy taxes.
(10)	Includes $1,100,720, which represents the value of performance stock award shares settled in cash, which was deferred; $1,100,720, which represents the value of performance stock award shares that were deferred; and $3,336,800, which represents the value of the restricted stock units that were mandatorily deferred.
(11)	The options and SARs exercised were granted between 2004 and 2005 with exercise prices ranging from $24.66 to $40.805 per share. Includes $849,306 representing the value of shares canceled to satisfy taxes.
(12)	Includes $532,660, which represents the value of performance stock award shares settled in cash; and $1,256,798, which represents the value of the restricted stock units that were mandatorily deferred.

NONQUALIFIED DEFERRED COMPENSATION

NONQUALIFIED RETIREMENT PLAN

Substantially all employees whose participation in Occidental’s qualified retirement and savings plans is limited by applicable tax laws are eligible to participate in Occidental’s nonqualified retirement plan, which provides additional retirement benefits outside of those limitations. Pursuant to such plans:

	•	Annual plan allocations for each participant equal the benefit amounts that would have accrued for salary, bonus and non-equity incentive compensation under the qualified plans, but for the tax law limitations.
	•	Benefits are fully vested after three years of service.
	•	Interest on nonqualified retirement plan accounts is allocated monthly to each participant’s account, based on the opening balance of the account in each monthly processing period. The amount of interest earnings is calculated using a rate equal to the five-year U.S. Treasury Note rate on the last business day of the processing month plus 2 percent, converted to a monthly allocation factor.
	•	All nonqualified retirement plan allocations made after 2005 are governed by the Occidental Petroleum Corporation Supplemental Retirement Plan II (SRP II). Those made prior to 2005 are governed by the Occidental Petroleum Corporation Supplemental Retirement Plan (SRP I), which is substantially the same as SRP II, and which was in effect prior to the adoption of the American Jobs Creation Act of 2004.

NONQUALIFIED DEFERRED COMPENSATION PLAN

Prior to 2007, Occidental maintained the 2005 Deferred Compensation Plan, which permitted executives and other eligible employees to defer up to 75 percent of their base salaries and up to 100 percent of their annual bonus and non-equity incentive compensation each year, and the Grandfathered Deferred Compensation Plan that was closed to future deferrals. In October 2006, various amendments to both plans were adopted, resulting in the Modified Deferred Compensation Plan, effective December 31, 2006.

	•	Under the Modified Deferred Compensation Plan, the maximum amount that may be deferred for any one year is limited to $75,000. In 2007, the new $75,000 limit applied only to base salary deferrals.
	•	A participant’s overall plan balance must be less than $1 million at the end of any given year to enable a participant to defer compensation for the subsequent year.
	•	Deferred amounts earn interest equal to Moody’s Long-Term Corporate Bond Index Monthly Average Corporates plus 3 percent. However, commencing in 2009, deferred amounts will earn interest at a rate equal to the five-year U.S. Treasury Note rate plus 2 percent, except for amounts deferred prior to 1994, which will continue to earn interest at a minimum interest rate of 8 percent.

Payment of deferred amounts generally commences at retirement. However, in light of the creation of the Modified Deferred Compensation Plan, participants were given the opportunity to make a special one-time election, permitted by the transition relief under Section 409A of the Internal Revenue Code (“Section 409A”), to change the distribution election covering each participant’s Modified Deferred Compensation Plan account balance as of December 31, 2006, and any deferred 2006 bonus and non-equity incentive compensation (the “2006 bonus”). The election, which was effective December 31, 2006, permitted a participant to elect to receive his or her entire December 31, 2006, account balance and 2006 bonus (i) prior to separation from service in up to two early distribution years commencing as early as July 2007 for the account balance and the first quarter 2008 for the 2006 bonus; or (ii) at retirement or separation from service, but in any event no earlier than July 2007. Each participant also was permitted to elect payment arrangements (lump sum or annual installments) for each early distribution date chosen, as well as for the participant’s retirement distribution under the Modified Deferred Compensation Plan.

Dr. Irani and Messrs. de Brier and Morgan elected to take their entire Modified Deferred Compensation Plan December 31, 2006, account balances in a lump sum in July 2007. Mr. Chazen elected to take distribution of 90 percent of his December 31, 2006, account balance in July 2007. Mr. de Brier elected to take his deferred 2006 bonus in the first quarter of 2008. The distributions made in 2007, pursuant to these elections, are shown in the “Aggregate Withdrawals/Distributions in 2007” column of the Nonqualified Deferred Compensation Table below.

DEFERRED STOCK PROGRAM

The Occidental Petroleum Corporation 2005 Deferred Stock Program (2005 DSP) was originally adopted to permit executives to defer the receipt of qualifying stock awards as deferred share units. Deferral elections were irrevocable and were made 12 months prior to the completion of the performance period that related to the performance-based awards. The program also covered stock awards that provided for mandatory deferral upon vesting. Deferred share units earn dividend equivalents that may be paid currently in cash or reinvested as additional deferred share units. Payment of deferred share units generally commences at retirement. All stock deferrals made prior to 2005 were governed by the Occidental Petroleum Corporation Deferred Stock Program (DSP), which was substantially the same as the 2005 DSP. However, in recent years, the liability and expense of these programs have grown substantially due to (1) the significant increase in the price of Occidental’s stock, (2) mandatory deferrals of certain equity awards and (3) sustained increases in Occidental’s stock dividends. After careful consideration, Occidental concluded that program expense should be reduced. To accomplish this objective, the following changes were made to the DSP and 2005 DSP in October 2006:

•

The DSP was terminated, effective October 31, 2006, and all deferred share units were distributed in November 2006.

•

The 2005 DSP was frozen, effective January 1, 2007, for any deferrals other than those currently pending for outstanding stock awards.

In light of these changes, in October 2006, participants were given the opportunity to make a special one-time election, permitted by the transition relief under Section 409A, to change the distribution election covering each participant’s 2005 DSP account balance as of December 31, 2006; any deferral of the PSA certified by the Compensation Committee in February 2007; and any mandatorily deferred RSUs. Under the special election, each participant could elect to receive his entire December 31, 2006, account balance and any award amount that may become payable from the participant’s 2003 PSA, either (i) prior to separation from service in a lump sum in July 2007 for the 2005 DSP account balance and in January 2008 for any deferred 2003 PSA certified in 2007; or (ii) at retirement or separation from service.

All of the named executive officers elected to take their 2005 DSP account balance as of December 31, 2006, in a lump sum in July 2007 and their mandatorily deferred RSUs that vested in 2007, as a lump sum in January 2008. Messrs. Chazen and Morgan elected to receive the PSA award certified in February 2007 in January 2008. The distributions made in 2007, pursuant to these elections, are shown in the “Aggregate Withdrawals/Distributions in 2007” column of the Nonqualified Deferred Compensation Table below.

The following table sets forth for 2007 the contributions, earnings, withdrawals and balances under Supplemental Retirement Plan I – SRP I, Supplemental Retirement Plan II – SRP II, Modified Deferred Compensation Plan – MDCP and 2005 Deferred Stock Program – 2005 DSP in which the named executive officers participate. Each of the executive officers is fully vested in his aggregate balances shown below. The footnotes provide information about other amounts that were reported as earned in the Summary Compensation Table on page 23 for 2007 and prior years.

Nonqualified Deferred Compensation
Name	Plan	Executive Contributions in 2007 ($) (1)		Occidental Contributions in 2007 ($)		Aggregate Earnings in 2007 ($)			Aggregate Withdrawals/ Distributions in 2007 ($)			Aggregate Balance at 12/31/07 ($)
Ray R. Irani ⁽²⁾	SRP I	$	0	$	0	$	247,880		$	0		$	4,036,142
	SRP II	$	0	$	551,625	$	115,864		$	0		$	2,049,848
	MDCP	$	0	$	0	$	1,708,305		$	37,622,552		$	0
	2005 DSP	$	33,735,078	$	0	$	1,203,757	⁽³⁾	$	100,968,215	⁽⁴⁾	$	39,377,767
Stephen I. Chazen ⁽⁵⁾	SRP I	$	0	$	0	$	103,347		$	0		$	1,682,759
	SRP II	$	0	$	231,225	$	45,955